Small vs. Large Businesses
By Arnold Kling
In this essay, I write
Small organizations are the size of hunter-gatherer bands. The behavior of each individual can be monitored and constrained by the group, using instincts that are deeply embedded by evolution into our social psychology. Members want the approval and respect of the group, and this desire is sufficient to orient the individual toward obtaining group goals.
…Large organizations incorporate more people than a prehistoric tribe of hunter-gatherers. The social psychology of tribalism, in which people trust fellow tribe-members but fear and dislike other tribes, can be a hindrance within a large organization. Conflicts between individual interests and organizational interests require much more careful management.
Actually, I try to pack a lot of ideas into this essay. The main point, taken from Amar Bhide, is that large organizations utilize planning while small organizations use improvisation.