While the company is expanding its business, it is also increasing its own corporate entropy. The greater the difference in business, the more different management methods are required, which in turn necessitates preventing more managers. The difference between a manager and a CEO lies in the incentive mechanism.

Japanese companies generally do not control corporate entropy at all; businesses can shift from manufacturing cars to producing pianos. Therefore, in the last round, Japanese companies often appeared large but not strong. This was primarily due to excessive corporate entropy, and those managing these diverse business segments were merely managers, some of whom were several levels removed from the board of directors and had no motivation to manage the business well (first of all, the vast majority of managers do not understand what it means to 'manage a business well').

American companies are relatively focused, which brings significant competitive advantages. Of course, this is also because the domestic market in the U.S. is large enough, and there are opportunities for global sales.

Chinese companies, particularly in the internet sector, may reference the American model more, albeit with some expansion. For example, Xiaomi has a wide range of business activities, and Tencent also has about four businesses that are not very closely related. In contrast, Nvidia, Meta, Microsoft, and Apple can be considered single-business companies.

However, the American model of overly optimizing for a single business does come at a cost. For instance, Apple surprisingly abandoned its car project, and Meta failed to successfully create hardware, though there are some successes as well.

Ultimately, it still boils down to issues of incentive mechanisms and talent, as well as the need for some form of dividends, whether they be market dividends or talent dividends.

As a government, what should really be done is to create these 'dividends' so that one can compete globally without much effort, like TikTok.