TLDR: Traditional companies face competition from small firms leveraging AI to reduce coordination overhead, leading to fewer employees needed for similar outputs. Most executive roles may focus on coordination rather than irreplaceable judgment, as AI can replicate many decision-making tasks. Companies with fewer people supported by AI will have significant cost advantages. The future favors smaller teams where the value lies in decision-making, not coordination. Executives must reassess their roles and the true extent of their judgment against AI capabilities.
The Coordination Tax
