The original story really dropped the ball on that aspect, I think. Shinra went from a (stinky) boardroom filled with figures all vying for power to Diamond Weapon blasting Rufus and then... idk that's about it but Proud Clod sorta pops up near the end of the story to wind things up, I guess?

Maybe it's not so relatable to a westoid like me because I don't have connection to fairly recent cultural history of ruling dynasties being handed down to successors before tragedy strikes, where that unifying force is dissolved, leading to quarreling factions and widespread political disunity. I feel like if I came from a Japanese cultural background it would be more within my frame of reference to be like "Oh, I know this story - the Daimyo has fallen and now the political structure is crumbling" on reflex whereas my cultural context is much more steeped in corporations and political parties being like a hydra rather than leviathan and I have to step outside my own cultural bubble to try and understand how the story progressing this way might have been a lot more commonsensical to a Japanese game dev team than it is to me.

That, or FF7's story is a rolling disaster that was only ever barely strung together and it really starts falling apart at the seams in the third act.