The modern business enterprise is easily defined. It has two particular characteristics: it contains many separate operating units and a hierarchy of executives. As a social innovation the modern enterprise was born when the volume of economic activities reached a level that made administrative coordination more efficient and more lucrative than market coordination.
Before the rise of the modern firm, the activities of small, often personally owned enterprises were enabled and constrained by market and price mechanisms.
The important innovation of the modern firm was to “internalize” activities by bringing many discrete components under one roof and under a system of coordination. The modern multi-unit business corporation replaced the small, single-unit, enterprise because administrative coordination permitted greater productivity and lower (transaction)costs per task than was possible before.
The big idea behind industrial management was to purchase or set up units that were fit enough to operate as independent entities, but instead integrate them into one system. Bringing these activities together gave the corporation many advantages: by standardizing interaction between units, the cost of transactions were lowered and the cost of information on markets and sources of supply were dramatically reduced.
The principle of internalization permitted the flows of goods, services and information to be planned from one unit to another. Budgeting of flows allowed more efficient use of facilities and personnel than was the norm earlier. The advantages of internalizing many business units within a single enterprise could not be realized without management.
Managers essentially carried out the functions formerly handled by price and market mechanisms. Managers were now the enablers.
The practices and procedures that were invented at the dawn of industrialism have become standard operating methods and are still taught in business schools today. The existence of a managerial hierarchy as means for coordination is not questioned. It is the defining characteristic of the modern business enterprise.
Facing a world that has changed
Two aspects of work have changed dramatically. First, all financially successful offerings involve customization, or aggregation by the end-user. This means that companies must thrive in situations where very little information or communication can be made routine. Second, all successful firms are actively involved in emergent, responsive interaction with people “outside”: customers and network partners. These firms understand that value is not created inside the organization but in the larger ecosystem they are one part of.
We all have mindsets of the world that serve as maps that guide what we see and how we understand the world around us. The maps can be helpful but also outdated and incorrect. Management practices of the industrial, passive-mass-consumer era were based on standardization, management coordination and repetition. These approaches and principles are not just less useful, but critically wrong today.
Both of the change drivers: customization and interactive value creation, demand that firms value people more than they value budgets, processes, organizational units and hierarchies. Firms must attract and link contributions from skilled individuals – no matter where those people are and where those contributions come from. The products the firm sells to its clients are not offerings of the firm per se, but offerings created by specific individuals in specific situations of “local” interaction. This is why business-to-business (B2B) value systems are not different from business-to-customer (B2C) value systems. It is about people in interaction in both cases.
Work is always interaction between interdependent individuals.
It is now more expensive to internalize than to network
Interaction can only partially be planned in advance. People need to participate based on transparent information and high quality communication systems enabling responsiveness. Some work is also in the future located “inside” the firm, but the really important part of interaction takes place “outside“. A larger and larger number of the contributing individuals are necessarily customers and network partners who are outside the company Intranet as we know it know. The explanation for this is that it is now more expensive to internalize than to network. The fundamental principles of organizing are changing because of the Internet and the low cost and high quality of communication. This is why there are no, and never will be, successful social media implementations inside firewalls.
Work today is network-enabled, situational collaboration based on interdependency that typically links operational units and spans over traditional value systems. The approach that managers do the coordination for the workers is just too slow and too costly in the low transaction cost environments we live in today.
The enablers have turned into a constraint.
The systems of value creation need to be architectures that make wide area participation possible. The goal is interoperability and low barriers to experimentation and networked learning.
The task today is to create a valid context in which people think about and experience social media / social business. The difficulty is that this context has to make sense in the world we are going to, and not the world we are coming from.
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Thank you Ralph Stacey, Doug Griffin, Kim Weckström, Tim O’Reilly, Alfred Chandler, Riitta Raesmaa, Olli Parviainen and Luis Suarez
More on the subject: what bosses do in the Economist. A post on group intelligence by Tom Malone. Work of Steve Denning. Article in the Ivey Business Journal. More on the new context: digital literacy. Greg Satell on networks. Stowe Boyd´s blog post.
What it takes to get a job done
April 25, 2011
Physical tasks can normally be broken up in a reductionist way. Bigger tasks can be divided by assigning people to different smaller parts of the whole. For intellectual tasks, it is much harder to find parts that make for an efficient division of labour. Intellectual tasks are by default linked and complex. Reductionism does not work.
The machine metaphor led to the belief that if we only can arrange the parts in the right way, we optimize efficiency. When the image of work was the assembly line, work could be fragmented and individual performance goals could be set for each worker. The world was all about little boxes separated from one another.
The demands of work are different now: how efficient an organization is reflects the links people have with one another and the links they have to the contexts of value. How many handshakes separates them from one another and from the things that matter? We are beginning to see the world as relations.
When we talk about relations, we often take examples from nature: murmuration and bird flocks. The V shape of a bird flock does not result from one bird being selected as the leader, and the other birds lining up behind the leader. Instead, each bird’s behaviour is based on its position relative to nearby birds. Ornithologists say that the V shape is not planned or centrally determined; it emerges out of simple, and relatively few, rules of interaction. The bird flock demonstrates a striking feature of emergent phenomena. But the birds do not need to figure out the rules of flight that guide how they organize themselves. These rules are genetically hardwired. Nature provides this for the birds.
Birds then are not “free like birds”.
When it comes to people it is a different story. Mother nature does not provide deterministic rules for collaboration. We are free to choose, or not to choose, our own ways of doing things together. Accordingly we are ourselves responsible for formulating the principles we use to organize our life. Social systems are thus fundamentally different from natural mechanisms.
New architectures of work
We have examples of social architectures that redefine some basic beliefs about social systems.
The wiki is at the moment the best departure from division of labor and workflows. Wikis let people work digitally together the very same way they would work face-to-face. In a physical meeting, there are always more or less the wrong people present and the transaction costs are very high. Unlike email, which pushes copies of the same information to people to work or edit separately, a wiki pulls non co-located people together to work collaboratively, and with very low transaction costs. Email and physical meetings are excluding ways of doing things. They leave people out. A wiki (depending on the topic, the context) is always inviting and including. The goal is to enable groups to form around shared contexts without preset organizational walls, or rules of engagement.
Ward Cunningham described his invention in 1995 as the simplest online database that could possibly work. An important principle of the wiki is the conscious emphasis on using as little structure as possible to get the job done. A wiki does not force hierarchy on the people. In this case, less structure and less hierarchy mean less transaction costs. A wiki always starts out flat, with all the pages on the same level. This allows people to dynamically create the organization and hierarchy that makes most sense in the situation at hand to get the job done.
People work together to reach a balance of different viewpoints through interaction as they iterate the content of work. The wiki way of working is essentially the digital and more advanced version of a meeting or a workshop. It enables multiple people to inhabit the same space, see the same thing and participate freely. Some might just listen, some make comments or a small edits, while others might make more significant contributions and conclusions.
New work is about responsive, free and voluntary participation by people who contribute as little, or as much as they like, and who are motivated by something much more elusive than only money. The society has moved away from the era of boxes to the time of networks and linked individualism. Being connected to people – from elsewhere – is a cultural necessity and links, not boxes, are the new texture of value creation.
Organizations are their communicative performance.
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Thank you R. Keith Sawyer, Stewart Mader, Robert Cummings, Rod Collins, Doug Griffin, Kim Weckström, Richard Harper and Yochai Benkler
More on the subject: Center for Network Culture. The Agile Manifesto. About Ushahidis. Zen habits. Examples of wikis.
Small worlds
March 27, 2011
I was taking part in a training course on the management during an extreme national emergency. As a part of the program, we went through an exercise that simulated a deep global crisis with severe implications for the governance of Finland. Although the gravity of the situation as it was expressed in the daily briefings was beyond anything we really experience, or can think of, at home today, all aspects of the apocalyptic views presented are actually a reality somewhere in the world at this very moment. This led me to reflect on my learning.
Another reason for writing this was what is actually happening in real life at home. Finland has traditionally been one of the most pro-European Union countries. But now the government seems to be blindsided by the rise of the populist anti-euro party. In the face of the assault of the “True Finns” the Social Democrats too seem to be abandoning their pro-EU roots. If this trend continues after the elections, where are we heading?
The experience brought by the Internet is that all people on our planet are only a few links, or handshakes, away from each other. The claim is that even when two people don’t know each other or do not have a friend in common, only a short chain of intermediaries separates them. Stanley Milgram performed his first famous experiments even before the era of the mobile phone and the web. His results indicated a median chain length of less than six (degrees of separation). The research was groundbreaking in suggesting that the whole global human society is an interdependent network characterized by extremely short path lengths. If the median was just below six in 1967, it is safe to assume that the number is even lower today.
The dominant ways of thinking about the world have their origins in Newtonian mechanics in which the universe was simply the sum of independent parts. At the moment, this part – whole thinking is being directly applied to the ways we think. Interdependence plays a minor role and is anyway seen as the result of a deliberate choice. The populist thinking follows the logic that we can choose not to be interdependent.
I learned last week that leaders cannot know what the outcomes of their actions are. This is because what really happens arises in the complex interplay of many actors with many intentions, which is why leaders cannot choose outcomes although they can choose their next action. We often create things together that nobody wants to create
Nothing ever happens in an independent way.
Interdependent individuals relate to each other in a responsive manner, with a gesture from one party calling forth a response from another. George Herbert Mead was the first social psychologist to take the stance that meaning arises in the responsive interaction between gesture and response. The important implication is that meaning does not then arise independently in each actor first to be then subsequently expressed in action. Actions are not independent. Meaning is not attached to any single act but is perpetually created in interaction. Knowing is then a property of the interaction. Cognition is relational.
Our perception of the world is confined to groups of immediate acquaintances. Sometimes this is good news, sometimes very bad.
The old ways of understanding human behaviour are not up to the task any more. In contrast to Newtonian traditions, the science of social networks offers an entirely new way of understanding the interdependent human society.
Let’s imagine your house is on fire. Luckily there is a lake nearby. But you are alone. You run back and forth but without some help you may not be able to carry water fast enough. Lets then suppose that you are not alone, and people around you want to help. If you have seen old movies where this happens, a peculiar form of organization emerges. People form a line from the lake to the house passing full buckets of water towards the house and empty buckets back towards the lake. What is happening is called a “bucket brigade”. It is not about the individuals or the community but about a particular form of emergent linking that at the same time distributes the task at hand and integrates the efforts of the people in a coordinated way. If we take the idea of the bucket brigade and connect it with the notion of the small world network, we have a global concept of participation.
A better understanding of social networks is essential for facing the new threats in the world. They are only a few handshakes away, whether we want it or not. This better understanding of interdependence also leads to the necessity for empathy and participation. Stanley Milgram proved that the distance between the fires and the lakes in our world is very, very short indeed. This is why we need to take part in the bucket brigades, and not only when our own house is on fire.
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Thank you Duncan Watts, Ralph Stacey, Kim Mattsson, Torsti Astrén, Arto Kujala, Marjo Korkeamäki and Anna-Mari Pesonen. Thank you Olli Haikala for coaching. Thank you Lapin Lennosto for the photo
More on networks
Patterns and social objects
February 27, 2011
Complex systems are, as their name implies, hard to understand. The main difference between the sciences of certainty and the sciences of complexity lies in the different causal frameworks they are built upon.
Up to now, we have seen the world around us as systems that, we thought, could be described and understood by identifying causal links between things: if I choose X, then it will lead to Y. If, on the other hand, I choose A, it will lead to B.
We are accustomed to drawing boxes and lines between the boxes. We try to model the world as predictable processes that we can control.
The mainstream ways of thinking about management are based on the sciences of certainty. The whole system of strategic choice, goal setting and choosing actions to reach the given goals in a controlled way depends on predictability. The problem is that this familiar causal foundation cannot explain the reality we face. Almost daily, we experience the inability of leaders to choose what happens to their organizations – or to their countries.
We live in a complex world. Things may appear orderly over time, but are inherently unpredictable. If a system’s long-term behavior is unpredictable, goals can still be set, but there is no certainty that the actions taken are going to realize them.
Complexity refers to a pattern, a movement in time, that is at the same time predictable and unpredictable, knowable and unknowable. Healthy, ordinary, everyday life is always complex, no matter what the situation is. Human patterns that lose this complexity become repetitive and rapidly inappropriate for dealing with life. Unlike mechanical systems, human systems thrive on variety and diversity. An exact replication of behavior in nature would be disastrous. For example, a failing heart is typically characterized by loss of complexity.
Human interaction cannot be understood as predictive processes but as patterns
A pattern is something that unfolds through the complex interactions between elements in a system. Although there is apparent order, there is never exact repetition if the system is viable. This is why human interaction cannot be understood as processes in the way they were used in manufacturing, but as patterns.
Patterns that are more repetitive are normally called routines or habits. However, those routines do not cause our behavior. Instead routines are emergent patterns. They emerge in what we do. They continue to be sustained only as long as they are present in our everyday interaction.
The American sociologist George Herbert Mead (1863 – 1931) distinguished between two types of objects: physical objects and social objects. While a physical object may be understood in terms of itself, a social object has to be understood as being composed of patterns of interaction.
Mead referred to a market as an example of a social object. The acts of buying and selling define a market. Markets cannot exist without these social activities. When one person offers to buy something, this act involves a range of responses from other people. A person making an offer can only know how to make the offer if she is able to understand the attitude of the other parties to the bargain. The ideas of buying and selling are thus always interconnected. This is why it is called a “social” object.
The routines define the object. The social object can only be found in the conduct of different individuals engaged in the social act. Thus, there is no market that can be understood as an “it”. Mead’s social objects are not things but generalized tendencies to act in similar ways in similar situations.
We find it easy to regard social phenomena as things with an independent existence. We talk about financial markets being “nervous”. We want more people to recognize patterns “to predict what is going to happen”. But patterns can only be found in the experience of interaction itself. They have no existence separate from interaction and we cannot influence the patterns as separate entities.
We can just participate in interaction – in a dull and repetitive way or in a creative and rich way.
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Thank you Jyri Engeström for opening this discussion on the 13th. of April, 2005, with “The case for the object-centered sociality“. Thank you also Melanie Mitchell, Ralph Stacey and Keith Sawyer.
More on the subject: Venessa Miemis. Thierry de Baillon. JP Rangaswami. Article on Wired magazine. Blog post on Complexitys. Gartner on “Emergent Structures” Deb Roy in TED
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
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.
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, not the sum of the parts.
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.
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Background: On serendipity
Thank you Stuart Kauffman, Sari Baldauf and Norman Johnson
Lessons from the early adopters of corporate social media
March 15, 2010
The mainstream approach to management places a heavy emphasis on the formulation of plans and intentions and then communicating them as actions to be implemented by the organization. The starting point for change involves conceiving a picture of the future that is somewhat different from the picture of the present. After the content side is taken care of, the focus is then on providing tools for the process of change.
The approach that is made possible through enterprise social media is very different. The question that is now asked is: “How can people participate in such a way that things develop and change over time?”
The strategic focus of the early adopters of corporate social media is an ongoing continuous movement that is open-ended, and always incomplete. The strategic logic is temporal rather than spatial. When following a spatial metaphor, there is a territory that can be explored and understood, but here the territory is seen as being under continuous development and formation by the exploration itself. “It is impossible to map an area that changes with every step the explorer takes.” People inhabit a world of emergence, uncertainty and responsive change.
Themes such as communities, social network analysis and social graph underline a fairly strong sense of definable relationships and a sense of “us”. Our studies, however, show that social media create a dynamic and shifting sense of groups one belongs to. Conversations always follow from previous conversations and move on involving others, often as a result of responses from outside the corporate firewall. Work utilizing social media has much less clear and managed beginnings and endings. There is, typically, no pre-conceived design for the pattern of work: it evolves live.
Corporate life is improvising together
Physical meetings in organizations are often more or less orchestrated and planned in advance: “You should come prepared. There should be a clear goal for the meeting.” Following this thinking, there is no true sense of creating the future together. It is much more likely that people construct what they have always constructed. When people use social media to connect, they experience the potential inherent in communication, depending on how they express themselves, and how they respond. “Social media create the experience of acting into the unknown, creating the future together, improvising together.”
By linking improvisation to a group, like in theatrical improvisation, we get to what is in fact happening in social media. All of us with our differing intentions, hopes and fears, are acting in corporate plays that are very close to improvisational theater. We are self-organizing in shifting social configurations in the responsive interplay of different players.
We are fellow-improvisers in corporate ensembles constantly constructing the future, and our part in what is happening, in responsive interaction. The idea of improvisation is often associated with notions of unrehearsed, unintentional action. However, the more skilled we are, the better we can improvise. The better we have planned, the more flexible we can be. The more intensely we are present, the more responsive we can be.
The real time web is creating a real time company
The most important outcome is that social media focus attention more on what people are doing in the present than on what they intend to do in the future. The focus is on communicative interaction, the next tweet and the latest blog post.
The pattern of relating also becomes very clear: “We get to see who is talking and who is silent? Who is invited to join and who is excluded or opts out?” The focus of attention is on the processes of participation and the life stream as the narrative of progress.
A senior manager in a very large multinational corporation explained the impact of social media: “Since I moved away from thinking that what I do is manage the corporation through communicating with the whole corporation, I have started to pay attention to my own participation with the people I meet or should meet, and my responses in everyday interaction. Through asking different kinds of questions and through pointing to different kinds of issues, through changing my own participation, I have in fact changed my company.”
Thank you Keith Johnstone, Srikumar Rao, Patricia Shaw and Doug Griffin
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
Networked knowledge and the process of knowing
January 21, 2010
Most of the information on the Internet is worthless to the majority of people. This obscures the transformative change going on at the moment. People are storing less and less information “inside”, inside computers, in private folders or in their memory because there is a new, better alternative: in the always on, always connected world, information is available “outside” on the Internet, more easily and more cheaply, with considerably smaller search costs. This is causing a fundamental shift in the way we manage information, use our ICT tools, or understand the competencies needed in the knowledge-intensive economy.
Before the Internet and efficient mobile communication devices, most professional occupations required individual competencies that in most cases had accumulated over years. This experience base, often called tacit knowledge, was used to retrieve answers from memory and to independently solve situations arising at work. Knowledge was situated in the individual. In order to help individuals cope with the challenges of everyday life, individual competencies needed to be developed. Our whole education system is still very largely based on independent individual learning and knowing.
The cognitive load of work has increased as a result of manufacturing giving way to knowledge-intensive work. As a consequence, the content of work is changing from generic, repetitive practices to contextual, creative practices. This makes the individual experience base, by default, too narrow a starting point for efficient work. Experiences can be a huge asset but experiences can also be a liability, creating recurrence where there should be innovation. Knowledge work is not performed by independent individuals but by interdependent people in interaction. A new way to understanding work and competencies is unfolding: many knowledge workers claim that today they can know, on demand, by communicating with their network and retrieving answers from the Internet, more easily than from their own “inside” sources.
Knowledge used to be understood as the internal property of an individual. Today knowledge should be seen as networked communication. This requires us to learn new ways of talking about education, competencies and work itself. What is also needed is to unlearn the reductionist organizing principles that are still the mainstream. Work is communication and the network is the amplifier of knowledge.
The process of communication is the process of knowing. You can only know what you are doing in conversation. If we want to influence the process of knowing we need to develop new habits of participation and new habits of communication. This is what the new interaction technologies and tools allow us to do. This is also where agile practices impact on knowledge work in a similar way to that in which lean practices impacted on manufacturing. The creation of new habits of agile participation and new habits of communication is the primary focus of my research and my practice.
Thank you Doug Griffin for thinking and working on this with me.
The agile organization
January 14, 2010
The management approach to getting something done is to create an organization. If something new and different needs to be done, a new and different kind of organizational form needs to be put into effect. Changing the lines of accountability and reporting is the epitome of change in firms. When a new manager enters the picture, the organizational outline is very often changed into a “new” organization. But does changing the organization really change what is done? Does the change actually change anything?
An organization is metaphorically a picture of walls defining who is inside and who is outside a particular box. Who is included and who is excluded. Who we are and who they are. This way of thinking was fine in repetitive work where it was relatively easy to define what needed to be done and by whom as a definition of the quantity of labour and quality of capabilities. As a result, communication design created two things: the process chart and reporting lines.
In creative, knowledge based work it is increasingly difficult to know the best mix of capabilities and tasks in advance. In many firms reporting routines are the least important part of communication. Much more flexibility than the process maps allow is needed. Interdependence between peers involves, almost by default, crossing boundaries. The walls seem to be in the wrong position or in the way making work harder to do. What then is the use of the organizational theatre when it is literally impossible to define the “organization” before we actually do something?
What if the organization really should be an ongoing process of emergent self-organizing? Instead of thinking about the organization let’s think about organizing. If we take this view we don’t think about walls but we think about what we do and how groups are formed around what is actually going on or what should be going on. The role of management is then to define tasks and outcomes but not to say who does what. The new task for managers is to make possible a very easy and very fast emergent formation of groups and to make it as easy as possible for the best contributions from the whole network to find the applicable tasks, without knowing beforehand who knows.
The focal point in organizing is not the organizational entity one belongs to, or the manager one reports to, but the reason that brings people together. What activities and tasks unite us? What is the cause for interdependence and group formation? My friend Jyri Engeström calls this a social object. My understanding of “social object” as an idea is more derived from the work of George Herbert Mead and my friend and mentor Doug Griffin. Because of this different background, a social object, in my vocabulary, is more often called a context or even an attractor. Although the word attractor has a different and very specific meaning in the sciences of complexity, I like the picture of an organization without walls, rather like magnetic fields defined by gradually fading rings of attraction.
These contexts create transparent, permeable boundaries between them, not walls. Instead of the topology or organizational boxes that are often the visual representation of work, the architecture of work is a live social graph of interdependence and accountability. Our thinking about organizations is very much based on the old expensive and low-quality communication. The reality today is very different. Communication as the key driver in organizing is both high-quality and cheap. One of the biggest promises of social media is easy and efficient group formation! It is just our thinking that is in the way of bringing down the walls.
