Former Google CEO Eric Schmidt recently made waves when he said that Google’s remote work policy is the reason they have fallen behind in the AI arms race. Schmidt has highlighted AI’s impact in Ukraine, Myanmar, Sudan, and Gaza.
The waves of debate in the business community centre on whether in-person collaboration essential for innovation?
Alex Zekoff, CEO and Co-Founder of Thoughtful AI, a company active in the U.S. healthcare system, believes an in-office mandate for companies looking to change the world is necessary:
Zekoff’s view is: “Schmidt fundamentally understands how competition works in a capitalist society. High-margin businesses like Google create demand for new entrants because of the attractiveness of the business model.”
This ignores capitalism’s tendency towards monopolisation; however, there is some logic in Zekoff’s assessment about the need for new entrants into a dynamic marketplace.
Zekoff takes a slightly different position, in noting: “To create long-term durability (50+ years), a company must create long-term differentiation through (1) products/services and/or (2) brand over many tech cycles.”
This means that part of Google’s slippage is due to the company failing to sufficiently innovation, as Zekoff observes: “While Google won the Internet search era, it rested on its laurels and didn’t create a high-performance culture in the long run. They optimized for work-life balance, which is a big reason why they are behind in the AI arms race.”
Basically, Zekoff says that Google got too complacent and is now playing catch up.
Here the analyst opines: “Large companies become risk averse as they scale because they are protecting their moat and cash cow business lines. They are not willing to continue to disrupt their own business models because public markets tend to reward short-term quarterly outcomes. Smaller companies can win over larger companies because they have nothing to lose in the beginning and are willing to outwork large companies to move ten times faster.”
Zekoff has mandated much of his staff to be present in Thoughtful’s Austin office as the company’s warrior culture pushes for a win-now approach and innovation. Zekoff sees in person work as the key to doing so for many start-ups like his own.
