Online multiplayer games teaching management

May 13, 2010

Teams are the archetypal functional units of a firm. They provide the means to combine the different skills and perspectives that are needed to get things done. Interaction between people is relatively easy because of the co-location of the team. People are physically together in the same place at the same time. The office space and office hours matter because they make managing easy. Coordination and communication are efficient and low-cost. Recently, however, many teams have been organizing themselves very differently. Teams increasingly consist of people who are scattered around various locations.

Almost all teams are dispersed on some level. Their members can belong to different organizational units. They can be spatially separated with work-spaces on different floors of the building. According to recent research, this is equal to working in different cities. They can also be temporally separated, meeting seldom or even working in different time zones.

Research has shown that even small degrees of separation affect the quality of collaboration in traditional settings. I understand collaboration here as an equation involving three variables: communication x coordination x responsibility. My idea of collaboration is thus very close to the mainstream understanding of the role and tasks of management. The more collaboration there is, the less (command and control) management is needed. You get my point?

It is no surprise that conventional management thinking has suggested that performance suffers with increasing dispersion. Because of this, managers have typically seen mobile and distributed work as liabilities rather than as opportunities. Geographically distributed teams have commonly been called virtual teams and seen as a secondary, less real, alternative to real teams. This label is not adequate any more. Distributed teams are very real!

Distributed work is not an alternative work practice any more, but the default state of value creation. Distributed participation offers tremendous opportunities and can significantly outperform co-located work when the setting-up and management are done in the right way.

The new landscape of work is alien territory for most of today’s business leaders and business schools, but things are already moving towards a new world. Important decision making is often distributed in order to enable fast responses to change. A lot of the work is done in global teams. These teams are often partly composed of people from outside of the corporation. Teams assemble for a single project and the leader has no formal authority.

The most interesting thing is that coordination and communication take place mainly through digital, rather than face-to-face interaction.

The new rules for network based work

The new landscape of work consists of the network as the architecture of work and work as interaction between non-co-located but interdependent people. The astonishing thing is that we can find an existing, efficient, working model for this kind of digital work. It is multiplayer online games and the game environment in general.

The game environment may be the best productivity suit available for digital work. Adopting the qualities of the multiplayer games could help firms to meet the pressing challenge of mobile and distributed work. What then can be learned from these games?

The pace of games is normally very fast and requires fast decision making. Decisions are typically based on incomplete information and are iterated as more data become available later. You can’t take a lengthy pause to weigh up the options. The culture needs to embrace changing decisions and adopting constant corrections to the course that was initially chosen.

Acting in the game environment is always based on uncertainty. You can’t succeed in an uncertain environment without trial and error, without taking risks. You can’t embrace risk taking without accepting failures. Here the game environment is fundamentally different from most corporate cultures. In corporations the often-heard objection to trying out something is: “We’ve already tried it and it didn’t work!” The game environment approach is “Let’s try that again. The situation has changed and we have learned!” Frequent risk taking and confronting risks routinely help players to learn to keep paradoxes alive calmly and to live efficiently with continuous uncertainty.

Leadership in games is often temporary. Leaders switch roles. They direct others one minute and take orders the next. Leadership is a task, not a position or part of the identity of an individual. Players with good relational skills are efficient at forming teams and keeping them motivated. The leader of the group in the forming stage knows that someone else’s skills may be better suited for the next effort. The group often makes the choices about who will lead and who will follow. These decisions are most often based on volunteering, not dictated by a higher authority.

Companies often identify people as leaders because of the high potential they show early in their careers. That model may not work in the future. The growing complexity of business means that no single leader can handle all the different challenges any more. Treating leadership as a temporary state and a task can be the new model of the future. The assumption that leadership resides within an individual may not be correct.

Getting the network environment right for collaboration is much more important.

Foursquare and Facebook likes

To get the network environment right, there are some readily available lessons from which to learn: We can learn from Foursquare, Facebook and the World of Warcraft. The takeaways from Foursquare and Facebook likes is that digital credits that are earned can (and will) be a synthetic currency. People care a lot about gains and losses of points that are made visible immediately after a task is completed. The gains are even more interesting if they can be compared with the scores of other players. People could get credit/synthetic currency from their peers for contributing a blog post, or even re-tweeting important information. Pushing the Facebook  like button could mean giving virtual money.

Transparency allows the taking of responsibility

Efficient digital environments like the World of Warcraft make information open to all of the players, all of the time. This information includes performance statistics and trend information for reflexive work. Real-time status updates on operations make planning the next move easy. The mainstream corporate approach to knowledge management has assumed that thinking and doing are separated. In the game environment a player is expected to act on the available information, without waiting for instructions from the boss. The most interesting thing in the game environment is that transparent information allows players to take responsibility, to assume leadership as needed.

Widespread adoption of the approach of the game environment to communication, coordination and taking responsibility would require a dramatic change in the mainstream organizational culture. However, these games are here today and the generation that has grown up playing the games is growing up and joining corporations. They are going to be the drivers of the change towards a more productive and more fun work environment.

Thank you @Joi Ito and Thomas J. Allen

Background:

Real-time information. The Sandbox Summit. The Diaspora project. On collaboration. Jane McGonigal. Seriosity. Vili Lehdonvirta

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Competitive and collaborative games

May 9, 2010

When coordinated behaviour takes place without the intervention of a regulating authority, we often attribute the coherent action to the existence of values and ethics. We tend to think that the existence of a strong value base means that less or even no regulation is needed. A decay of values conversely means that rules and regulation are needed.

A game theory approach to values assumes that people choose the kind of behaviour that gives them the highest expected benefit over time, given their expectations about what the other players will do and the rewarding or punishing feedback they get as a result of their own actions. Players learn by trial and error, keeping strategies that work and altering the ones that turn out badly. Players always observe each other. Those with a poor performance often tend to imitate those who are doing better. What has worked is likely to be used again.

In most games who wins and who loses is the whole point of playing. It would be hard to imagine a more unpopular outcome in the reality TV-series that today are watched by millions, than an announcement that all the players ended up as winners! It is, of course, beneficial that the place of the lazy, the incompetent, and the unmotivated is taken by better-motivated and more enterprising players.

Competitive games require rules to prevent players from cheating. Competition should be as fierce as the existing laws allow, we think. Any ambiguity in the regulations is immediately exploited. This is where our thinking does not serve us any more. Innovations by the players often make existing rules obsolete and call for new ones, as we have recently experienced in the financial markets. The present relationship between regulators and financial institutions is a competitive game in itself. Instead of a home audience watching, here we have the markets watching. The principle is the same.

There are also other growing problems with the games we play. In competitive games, there is always a lack of appreciation for the need of complementarities. You are supposed to manage without help from others. As a result of competition which excludes, diversity is reduced in the system that the game is played in. There are also more losers than winners in our games. Losers multiply as winning behaviours are replicated in the smaller winners’ circles and losing behaviours are replicated in the bigger losers’ circles.

As losers are excluded from the game, they are not allowed to learn. The divide between winners and losers grows constantly. This is why, in the end, the winners have to pay the price of winning in one way or another. The bigger the divide, the bigger the price that has to be paid. The winners end up having to take care of the losers, or two totally different cultures are formed, as is happening in the big US cities today. Psychologically, competitive games create shadow games of losers competing at losing.

The games we play have been played under the assumption that the unit of survival is the player, meaning the individual or a company. However, today the reality is that the unit of survival is the player in the game being played. Following Darwinian rhetoric, the unit of survival is the species in its environment. Who wins and who loses is of minor importance compared to the decay of the (game) environment as a result of the competition.

We need a new concept of the game

In games that were paradoxically competitive and collaborative at the same time, losers would not not be eliminated from the game, but would be invited to learn from the winners. What prevents losers learning from winners at the moment is our outdated zero-sum thinking and the winner-takes-all philosophy. In competitive/collaborative games the winners would be all those whose participation, comments and contributions were incorporated in the development of the game.

The most important reason why we need a new concept of games is because the players and their contributions in the real world are, at best, too diverse to rank. They are, and should be, too qualitatively different to compare quantitatively. In competitive games the players need to have the identical aim of winning the same thing. Unless all the players want the same thing, there cannot be a genuine contest. Zero-sum games were the offspring of scarcity. In the era of creativity and abundance, new approaches are needed.

In competitive/collaborative games the approach to rules is very different from before. The rules should be created, agreed upon and changed by the players themselves as the game continues. As there absolutely cannot be pre-existing rules for every conceivable situation that might arise, we have to move beyond seeing the players and the rule-makers as separate parties. The games are too complex to be governed totally from outside. We desperately need values-based participation as a prerequisite for taking part.

The players have the responsibility not only for adhering to the existing rules, but also for developing the rules further – specifically when the game (environment) decays as a result of the actions of the players.

The criteria for success in competitive games do not lie solely in winning but in the development and continuation of the game itself through collaboration.

Thank you Fons Trompenaars and Robert Axelrod

Background

Situational values or sustainable values.

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The real Enterprise 2.0

April 30, 2010

Lenin famously said that the economic system in Russia would be run as one big factory. Many economists at the time said that this was impossible. Yet there were already big factories in the West then, and there still are, so why not? Is there a limit to the size of a factory that cannot be surpassed, or is it because the factory logic cannot be used outside of a real factory?

The typical hierarchical form of an organization is meant to simplify communication, accountability and the coordination of tasks. In theory an employee needs only one connection, to the boss. This is far easier than communicating with all and trying to coordinate actions with everyone. And what about accountability? The worker is accountable only to her manager. That manager reports to her manager on the next higher rank, and the chain goes further, leading in the end to – Lenin.

During the centuries since the publication of “The Wealth of Nations” by Adam Smith, in 1776, the principal theme of most economists has been that government regulation or centralized planning were not necessary in order to make an economic system function well. The coordination would be the result of markets. Lenin and the communists were advised to move to a market economy. The parties in that system follow their own self-interest and are governed, when it comes to the actual choices they make, by a system of prices. This is the polar opposite of centralized planning. Adam Smith was a proponent of extreme decentralization.

A 21-year-old comes out with a revolutionary new theory

Ronald Coase was one of the first economists who started to question mainstream thinking in economics. If a system of prices and competition would do all the coordination necessary, why did we have centralized planning, not only in the now bygone communist countries, but also in well functioning and successful firms? Why did we need management, whose function was to coordinate?

Ronald Coase set out to bring the different views together. It is almost impossible now to fathom that he found the answer as early as during the summer of 1932, at the age of 21. He realized that there were costs involved in using the pricing mechanism. The needs and offerings have to find one another. The prices have to be discovered. Negotiations need to be undertaken. Contracts have to be made. There may be disputes that later have to be settled. These costs were not part of “the invisible hand” equation of Adam Smith. Ronald Coase called these costs transaction costs.

The first revolutionary argument was that a firm would emerge, exist and continue to exist successfully only if it performed its planning, coordination and management functions at a lower cost than would be incurred by means of market transactions, and also at a lower cost than would apply if the same things could be performed by another firm.

The second revolutionary argument was that a well-functioning economic system needs both markets and planning. This depends on the size of the organization and the level of the market side transaction costs. Increasing the size increases (internal) transaction costs. Running an organization is difficult and running a bigger organization is more difficult.

Management is an overhead

Managerial overhead increases as the organization grows. Management, communication and coordination are all transaction costs. Every sales call, every offer, every agreement and every meeting also consumes limited resources and increases transaction costs. As the corporation grows, all its energy finally goes into maintaining the corporation and does not benefit external stakeholders.

Whenever transaction costs inside the organization reach the level of the transaction costs in the markets, markets outperform firms and outperform central planning/coordination in general. This was the main theoretical argument against Lenin. The same thing is clearly still evident today in companies like GM, or organizations like large health care units. Communist countries learned their lesson, but we still haven’t.

An organization can only be successful when the costs of hierarchical coordination are lower than the gains achieved from that coordination.

The existence of high transaction costs outside of firms leads to the emergence of the firm as we know it now, and management as we know it now. A large part of corporate economic activity is designed to accomplish what high market transaction costs prevented earlier.

The Internet is an extinction-level event for the traditional firm

If the (transaction)costs of exchanging value in the society at large go down drastically, the form and logic of economic and organizational entities also change! Accordingly, a very different kind of management is needed.

Today, with social media, we stand on the threshold of an economy where the fundamental processes of communication and coordination are being transformed.  Familiar economic entities are becoming increasingly irrelevant as the Internet, not the traditional organization, becomes the most efficient means to communicate, coordinate and exchange value.

For most of the developed world, hierarchies, as much as markets, make up the dominant economic pattern. The Internet is nothing less than an extinction-level event for the traditional firm. The Internet makes it possible to create new forms of value creation and new forms of value exchange. It changes our views of markets and hierarchies in ways that Adam Smith or Lenin could never have imagined.

Thank you @cshirky

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Communication and diversity secure system-wide performance. Competition doesn’t

April 20, 2010

In our competitive view of the world, we often think that the most capable are those who are the most competitive, and accordingly that competition creates and secures efficiency. But it may be that high performance is incorrectly attributed to competition and is more a result of diversity, self-organizing communication and non-competitive processes of collaboration.

Competitive processes lead to the handicapping of the higher-level system that these processes are part of. This is because competitive selection leads to exclusion: something is left outside. Leaving something out always means a reduction of diversity. The resulting less diverse system is efficient in the short term, but always at the expense of flexibility. Agility and complex problem solving require diversity. Everything goes fine if nothing changes and if there are only easy problems to take care of!

Self-organizing, non-competitive processes are about interdependent individuals and groups solving problems in a shared context. Interaction creates capability beyond what could ever be predicted just by looking at the performance of the individuals involved. The higher performance and robustness are emergent properties of interaction. They are not attributable to the parts of the system.

Social networks provide problem-solving capability that results directly from the amount of communication and level of diversity of communication. Most organizations would soon fail if all their employees thought alike or had little or no contact. There are two new challenges. The first is to understand the need for networking with views and values that are different. The second challenge is even bigger because of the mainstream reductionist thinking: our assumption has been that by understanding the parts in detail, we understand the whole. This is simply not possible! What happens in interaction between the parts is more important than the parts. The whole is the emergent pattern of that interaction.

Diversity here means the degree of unique information in the network. If all contribute the same information, then diversity is low. If each agent contributes relevant, unique information that is not shared by others, then the diversity measure is high.

Networks with a wide spectrum of information/experiences are resilient to noise. This facilitating effect of diversity is critical when dealing with difficult problems where false information can lead to expensive consequences.

Higher system performance and robustness occur through the simple combination of the different experiences of individuals, even though each individual takes part in communicative interaction from their own limited perspective.

The importance of self-organization and diversity is unfortunately still greatly underestimated today, particularly in hierarchical, centralized, monoculture systems – like firms. One of the great societal promises of social media is that interaction in wide-area networks, with enough diversity, can solve problems beyond the awareness of the individuals involved.

Thank you Stuart Kauffman, Sari Baldauf and Norman Johnson

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Responsiveness, emergence and self-organization

March 21, 2010

I gave keynote speeches at two conferences this week. The organizers of the events did not suggest a (#) hashtag to be used by the delegates. There wasn’t any backchannel Twitter discussion going on in the audience. I felt strange.

I wasn’t able to listen and respond to real-time feedback. I was missing the self-regulation and self-organizing that social media make possible. This is what I have grown so accustomed to. I started to ponder on two questions: Is it becoming more common for responsiveness to be the missing ingredient in many communities? And can there be rules for responsiveness that help to create viable communities?

I know that there are problems with two-way communication. There are the people with a pre-set interpretative model. We all know the people who are grinding their axe at the back of the room. They are the know-alls and the one-point-of-view evangelists, the people who insist on bringing all conversations round to their particular issue.

I know that there are even bigger issues: All participants are never visible. Any given conversation on the Web may have a few active participants and several silent ones. This creates a fundamental imbalance in the system and gives the oddballs the opportunity to dominate the space in a way that would be much harder to do off-line.

What I felt at the conferences was a crucial disparity: they hear me talking, but I don’t hear them. The audience was both present and absent at the same time. A conference with a Twitter backchannel creates inputs from the official speakers and responses coming from the audience that is present, but also the online audiences elsewhere. The most important thing is that the primary inputs can then be further adjusted on the basis of the responses from the group. There is real-time emergent self-organizing going on.

Information flows are far too often unidirectional. The audience is present but in a passive, invisible way. The tyranny of the hatemonger results from this one-way flow and scarcity of feedback.

The volume is too high for any single individual to filter out the useless or plain repulsive. There are, however, ways to filter out the irrelevant and the obnoxious, but it requires people to respond. If you are a participant, you are also a moderator.

The quality control has to be handed to the community itself without any single individual being in control. The solution is fairly simple in theory. It is about responsiveness and a mix of negative and positive feedback.

You always rate what you see. The ratings coalesce algorithmically into something that is called karma in Slashdot. If your contributions are highly rated you get karma points. The karma you have earned means that your subsequent posts begin life at a higher level than posts by others. Your ratings also have a higher value than ratings given by people with fewer karma points. Dynamic rating is to posts what links are to websites.

The people worth following, the leaders, raise bottom up. Hierarchies in network architectures are natural and dynamic heterarchies. In fact this is the only way that there can be leaders in democratic systems.

One algorithm tracks the value of contributions; the other tracks the value of contributors.

The Web 2.0 gave the audience a voice. What is happening at the moment is much more radical. It is not about representation but gestures and responses leading to emergence and self-organization. It is not about the message or the media any more. It is more about the rules of responsiveness. In a simplified way, you can express those rules as positive and negative feedback moving the whole system towards a particular direction based on the behaviour of the participants.

The definition of what is quality and what is crap is a result of the responsive interaction. It is not groupthink however, because the ratings of people with high karma points weigh more than the assessments of the average members. The huge problem is that the majority viewpoints get amplified, while minority opinions get silenced.

This is why we need a new category to support quality. It is diversity.

Changing the algorithm to reward diversity of opinion means the emergence of a system that looks totally different. Instead of highlighting posts with high average ratings, the system could highlight posts that have triggered a high divergence of ratings. There are many +5 responses, but also many -5 responses. The posts that inspire strong responses either way, both positive and negative, could then rise to higher visibility. The system can thus reward controversial voices, not only popular ones.

A viable system needs to reward perspectives that deviate from the mainstream.

We need perspectives that don’t aim to please everyone. The oddballs would still be marginalized but the thoughtful minorities who attract both admirers and critics would have a visible place in the ongoing process of creating the future in responsive collaboration.

Thank you Steven Johnson

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Bridging the gap between knowing and acting

March 6, 2010

Bridging the gap between knowing and acting is one of the main challenges for knowledge management. Organizational reality is often seen in terms of processes and actions that are based on plans and designs. Acting should thus be based on this knowledge. Thinking is seen as preceding acting.

Databases and documents are usually thought of as stores of knowledge.  From the mainstream Knowledge Management perspective, knowledge is understood to be stored in individual heads, largely in tacit form. It can become the asset of an organization when it is extracted from those individual heads and stored in documents as explicit knowledge.

But the everyday live interactions we experience do not exist in a meaningful way in any documents. What has happened can seldom be understood from the Excel sheets explaining the results of our actions. What really takes place is very rarely a predictable repetition of our plans.

The actions always vary, as those with whom we interact change and as the context of the interaction changes. In other words, there is normally always variation in processes, routines and actions. Actions are thus not based on knowledge that is separate from those actions. Accordingly actions are never fully explainable through documentation. Knowledge, in this sense, cannot be seen as residing in databases and attempts to store it in documents of some kind will capture only partial aspects of it.

Knowing cannot be separated from acting. Interaction is the process of knowing!

From the point of view taken here, knowledge is always a process of responsive contextual, live interaction as Ralph Stacey points out. It cannot simply be located in an individual head to be extracted as an organizational asset and then shared. Knowledge cannot be shared!

Knowledge is the act of interacting and new knowledge is created when ways of interaction, and therefore patterns of relationship, change. The knowledge assets of an organization are the patterns of interaction between its members and knowledge is destroyed when relationships are missing or are destroyed, as is happening widely in the corporate world today. Key corporate assets are lost through mismanagement!

Organizational change, learning and knowledge creation are the same as changes in communication.  Enabling new habits of communication and improving the quality of the conversation are the most important processes of knowledge management, and management.

Thank you Ralph Stacey

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Productivity and mobile devices

February 24, 2010

Lenovo unveiled their new tablet-capable business laptop last Monday. The company made a conscious decision not to bring out an iPad like tablet PC. They said customers don’t want it. “The feedback was that for our customers it would not work because of the need to have a physical keyboard.”

The discussion around a virtual or physical keyboard caught my attention. The purpose of a keyboard is fairly straightforward: to get words onto the recording medium. The ability to capture a symbolic representation of spoken language for storage or transfer frees information from the limits of individual memory or location. But do we need a physical keyboard for that?

The patent for the typewriter was awarded in 1868 to Christopher Sholes. An early problem of the typewriter was the jamming of the type bars when certain combinations of keys were struck in a very close sequence. As a solution to the problem, Sholes arranged his keyboard in such a way that the keys most likely to be struck in close succession were approaching the type point from opposite sides of the machine. The keyboard is actually configured to minimize speed of input. At the time, reducing the speed of the typewriter was the best way to prevent it from jamming. The QWERTY keyboard was designed to accomplish a now obsolete mechanical requirement. It can be claimed that it is very unproductive to use a keyboard as an interface to productivity tools. The situation would of course be different if we all used ten fingers and did not need to look at the keyboard as we type.

Mobile phones are still mainly associated with communication, not productivity software. As a result a knowledge worker needs two devices: a laptop and a mobile phone.

No mobile phone has created as much of a buzz as the Google Nexus One since Apple launched the iPhone. As in other Android-based mobile devices, there is no physical keyboard. Text input relies on a virtual keyboard. But there is also a voice-to-text input functionality. We could use our voice and video instead of a keyboard! And additionally the camera is paving the way towards augmented reality!

The third device category is tablets: bigger than mobile phones but smaller than laptops – and often without a physical keyboard. The critiques claim that tablets like the iPad are just laptops without keyboards, while others are really mobile phones with proper-sized keyboards, without any definition of a real market need. At least the Lenovo customers don’t want them. Hopefully the Lenovo case is not  a matter of history repeating itself, as when Ken Olsen was explaining that DEC customers didn’t want PC’s.

The question here is not only how we think about the means of input. In the corporate context, it is even more about how we think about productivity and what kind of software can be called productivity software.

Productivity is a function of interaction

Instead of thinking about productivity as if it were associated with certain types of documents, it is closer to experience to think that productivity emerges or does not, in people’s interaction with each other and in interaction with the devices we use. Productivity is a function of interaction. Interaction is the content of social media! Therefore, it may not be a very good idea to bring the old document-based productivity software to mobile phones, or use Lilliputian keyboards.

The key productivity focus should be on widening and deepening interaction and reflection. This leads to a new perspective on information-related practices and productivity tools. Rising productivity requires changes in the way we communicate. Can there be a richer and easier way to use our devices? This, by the way, is the main sales argument behind the iPad.

The fastest immediate increase in productivity comes from either learning touch typing or using voice and video as means of input. Perhaps the keyboard of the future is speech combined with transcription? Anyway, the productivity software of tomorrow needs to be interaction-based. The most efficient productivity suit of tomorrow may well be a combination of Twitter, blogs and Facebook.

You only need one mobile device! The decision as to whether the device you need is a mobile phone, a tablet or a laptop may not be the most important one what comes to the quality of interaction. An artist friend of mine said that when he paints, he does not interact with the canvas, “the recording medium”. He interacts with the world beyond the canvas.

Thank you Kuutti Lavonen

Background

Mobile data

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On cognitive and social presence

February 22, 2010

Have you ever wondered why you don’t see anyone reading a book when you visit companies? We associate reading with finding information and learning, but we also involve qualities such as contemplation, solitude and mental privacy when we think about books.

There is a mental framework that is used when dealing with books, and another distinct mental framework regarding information related practices in the corporate world. Basically, you are not allowed to read a book but you can read a document.

Documents and word processing are part of the mental framework of management today. Documents were born from the needs of a hierarchical, systemic approach to management. Information flowed down from the top in the form of PowerPoint slide decks containing vision statements, Excel sheets with goals and Word documents explaining corporate procedures. Information, which flowed up from the bottom, was used mainly to provide reports and data for managers, helping them to keep their employees accountable and to ensure the smooth operation of the business process.

The framework of computerized word processing is associated with terms like information flows and the sharing of information. This is not something you normally talk about when discussing a book. While a book provides a view of the contemplative mind, documents create a view of controlled content. Do you still ask why you can read a document but you are not allowed to use Facebook?

Instead of predictive process flows, knowledge work in practice follows a very different logic. A senior executive in one of the most successful multinational corporations in the world explained what was going on:

  • There may be a triggering event that needs to be explored.
  • The exploration is performed most efficiently through transparency, wide area engagement and a communal process of distributing the cognitive load of the case.
  • People don’t perform job roles. People participate in tasks. You don’t delegate, you invite!
  • People from the whole community should participate through voluntary self-organization as widely as possible at the same time, not sequentially.
  • The industrial process was long, sequential and divided. The knowledge based process is short, parallel and interactive.
  • As many people as possible with applicable skills should contribute, each spending as little time as possible.
  • Finally, the contributions and comments that are received should integrate into a modular solution than can be iterated.

Knowledge work is about a community-based cognitive presence. But cognition is just part of the answer. Work today is even more about social presence. To manage is to participate in the live conversations.

There cannot be management without a social presence.

A dramatic shift is needed in the mental framework of information, communication and work. Without this changing mindset, no efficient implementation of social media can be made in the corporate world. Work is communication. Conversations and narratives are the new documents. Conversations cannot be controlled. The only way to influence conversations is to take part in them. The most meaningful conversations are the ones where customers voice their views. Those conversations take place outside of the firewall in the new world of mass communication.

As much as we need to associate Facebook with work, we need moments of slower pace. We need to combine the qualities of contemplation, solitude and mental privacy with work.

Thank you Walter Ong. The photo is of an interior detail of the Alvar Aalto architecture in the Academic Bookstore in Helsinki

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On Apple and Nokia

February 14, 2010

The terms “knowledge worker” and “knowledge society” are around fifty years old. Peter Drucker and Fritz Machlup, a less known Princeton economist, coined them at roughly the same time around 1960.

Although the concepts have now been around for a long time, it seems that the implications for corporations are not clear yet and don’t show in the way competitive strategies are made. What is quite evident is that the emerging society is different in many ways from the industrial society.

There are some things we know about knowledge work.

Effective skills are always specialized, as regards both, successful companies and effective people. This means that highly knowledge-based companies are always, by definition, only a partial answer to the opportunities available. Michael Porter made us to think that the players in the game of business were (1) companies, (2) customers and (3) suppliers together with old and new (4) competitors coming with alternative (5) offerings. This was called the five forces model. The company was seen as an independent, self-contained unit of competition.

Seven years ago, Bill Gates spoke often of the pet project of his. It was going to change computing for millions of people. It was the touch screen tablet PC. The device is still on sale, but it never raised a fraction of the interest that the iPad is now generating. Was it because Microsoft did the project alone?

Because of specialized, narrow skill sets, a new role with a new role definition is needed in knowledge work. Nobody, not even Microsoft, can be successful without supporting contributions from network partners. The new role is a “complementor”. A complementor is not the same as a supplier. The connection is based on a non-hierarchic network relation, not the hierarchic value chain. Complementary contributions may be the most important explanation of business success today. What would the iPad or the iPhone be without the applications made by people outside Apple?

A classic example of complements is computer hardware and computer software. The greatest hardware engineers are in dire straits without the greatest software programmers, as Nokia has found out. Though the idea of complements is most apparent in ICT, the principle is universal: you can never have in-house all the specialized skills you need. A complement to an offering is another offering that makes it more attractive. People value hot dogs more when they have mustard. Because knowledge work is specialized, it never pays to try to make both.

The new strategic imperative is to identify complementors and to be inviting to them. To be competitive, is to be “selfishly” collaborative.

Thank you Barry Nalebuff

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The Google lesson for management

February 13, 2010

Eugene Garfield founded the Institute for Scientific Information in 1960.  His pioneering work was in citation indexing. This allows a researcher to identify which articles have been cited most frequently and who has cited them. Garfield’s studies demonstrated that the number of citable items, i.e. the number of papers, together with the frequency of their citation, meaning how many scientists link to the paper, is a good measure of scientific success. Nobel laureates write more papers than other scientists and these papers are more linked to than other papers. The system effectively measures quantity and quality at the same time.

Links on the Web are also citations, or votes, as the founders of Google realized. The whole Web is a densely interconnected network of references. It is no different to the age-old practice of academic publishing and citation indexing.

The observation of Larry Page and Sergey Brin that links are citations seems commonplace today, but it was a breakthrough at the time Google started on September 7, 1998.

What Google did was essentially the same as had been done in academic publishing by Eugene Garfield. At this time, relevance and importance were measured through counting the number of other sites linking to a Web site, as well as the number of sites linking to those sites. The PageRank algorithm includes other variables as well, but the measurement of links is still the core functionality of the system.

What Google has proved to managers is that people’s individual actions, if those actions are performed in a transparent way, and if those actions can be linked, are capable of managing unmanageable tasks.

Collaboration and collective work are best expressed through transparency and emergent, responsive linking. The mainstream business approach to value creation is still a predictive process designed and controlled by the expert/manager. This is based on the presuppositions that we know (1) all the linkages that are needed beforehand, and (2) what the right sequential order in linking and acting is. Neither of these beliefs is correct any more. The variables of creative work have increased beyond systemic models of process design.

It is time to learn from the Web.

By relying on the uncoordinated actions of millions of people instead of experts/managers to classify content on the net, Google democratized scientific citation indexing. To be able to manage the increasingly complex organizations of today, the same kind of democratization needs to take place in the corporate world. Companies are transforming themselves from industrial mass production to creating value in wide area networks of mass communication. The transparency of tasks is the corporate equivalent of publishing academic articles. Responsive linking, rather than predictive linking, acts as a measure of relevance and is the guarantee of quality. This has served the academic community well. It made Sergey Brin and Larry Page billionaires. Now is the time to do the same in the corporate world. Complex, creative, knowledge-based work requires new approaches. The Google lesson for management is, that the more work is based on responsive processes of relating and the more organizing is an ongoing process in time, the more value we create!

Thank you Jeff Howe and Ralph Stacey

Posted by eskokilpi
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