# AI could remove the coordination tax in large companies

Markdown copy of https://realalpha.app/s/ai-could-remove-the-coordination-tax-in-large-companies/ on Real Alpha, the best minutes from long interviews with the people building AI. Cite and link the page, not this copy.

- Speaker: [Eric Schmidt](https://realalpha.app/people/eric-schmidt/) · Eric Schmidt is a former CEO of Google and technology executive. · Scaled Google as CEO through 2011, now runs rocket maker Relativity Space and co-founded Schmidt Sciences.
- Host: [Nicolai Tangen](https://realalpha.app/people/nicolai-tangen/) · CEO, Norges Bank Investment Management
- Show: In Good Company with Nicolai Tangen
- Episode: [Eric Schmidt: Are We Ready for Superintelligence? | Podcast | In Good Company](https://realalpha.app/v/U5YtR3OG5Uo/), Oct 21, 2026
- Moment: 35:56 to 38:18 of the episode (2 min), playing on https://realalpha.app/s/ai-could-remove-the-coordination-tax-in-large-companies/; the episode from there: https://realalpha.app/v/U5YtR3OG5Uo/?t=2156

## Quote

> “Much of that **coordination tax can be eliminated** by these ai platforms for business”
> — [Eric Schmidt](https://realalpha.app/people/eric-schmidt/) at [36:44](https://realalpha.app/v/U5YtR3OG5Uo/?t=2204) · In Good Company with Nicolai Tangen

## Takeaways

1. Large organizations spend heavily on coordination and meetings.
2. AI may reduce the need for some planning and administrative roles.
3. Companies will still need inventors, salespeople and strong leaders.

## About this segment

Eric Schmidt says AI platforms can cut the coordination work that slows large organizations. He cites a fast-growing company that laid off 20% of its staff, mostly people doing planning and coordination.

From “Eric Schmidt: Are We Ready for Superintelligence? | Podcast | In Good Company”, Oct 21, 2026. [Watch the full episode](https://realalpha.app/v/U5YtR3OG5Uo/)

## Transcript

Transcribed by machine (Whisper) from the episode’s audio, so a word may be off here and there.

[35:59](https://realalpha.app/v/U5YtR3OG5Uo/?t=2159) What are the implications? for the way these companies should be organized? Well, the future companies, I think if you think about it for a while, I'm used to running large companies, and you are as well. If you have 10,000 people, what is the inefficiency of coordination among those 10,000 people? It's high. People spend days and days and days in meetings. I used to tell people, my job is to sit in meetings 12 hours a day, five days a week. And I work on the weekend too. So I worked 63 hours a week. That's what I told people. By the way, that's probably illegal in Europe, but that's what I did anyway. I would sit in meetings 12 hours a day, person, person, person, reason, narrative, so forth and so on. Much of that coordination tax can be eliminated by these ai platforms for business for the in companies that you guys invest in which i think

[36:57](https://realalpha.app/v/U5YtR3OG5Uo/?t=2217) is you know our first audience for what we're talking about they will be far more efficient they will have fewer people in staff right one of my friends wrote a piece in the wall street journal where he had his companies growing very fast he made a 20 he decided to lay off 20 of the people he told me later he got death threats for this um who did he lay off the glue people the people who were doing sort of planning and moving moving numbers around so he didn't need them anymore what did he need he needed sales people he needed regulated people to talk to regulators and he need program people who built the products and who who talked to people on the phone although less of those um so you're going to see more much more efficient business operations so for your audience, let's say you're running a 10,000 person company. My guess is you've got a couple of

[37:51](https://realalpha.app/v/U5YtR3OG5Uo/?t=2271) thousand people who you don't need. And you better figure out a way to legally and humanely transition them, retire them out, or what have you. You just don't need them. And instead, you're going to need the great inventors, the great salespeople, because it's a human deal. You're going to need some great leaders, and you're going to need people to talk to the government. Two questions we always ask people.

[38:15](https://realalpha.app/v/U5YtR3OG5Uo/?t=2295) One is, what's been your biggest personal failure?