OK .. so it looks like the Web, hyperlinks and ’social’ platforms for interaction are here to stay (unless electricity grids fail or corporations and governments completely take over the Web).

For the past couple of years at least there have been increasingly numerous and strident calls for fundamental make-overs of both management and leadership.  People everywhere are clicking into the fact that yesteryear’s models and ways are less and less effective .. and yet we all labor on whilst yelling “change .. change, or die .. etc.”

World-renowned organizational effectiveness guru Gary Hamel set out the fundamental challenge(s) in his 2007 book “The Future of Management“.  Others, such as John Hagel and John Seeley Brown’s “The Power of Pull“, have weighed in with equally sharp and challenging premises and theories.  All of these pieces signal an urgent need to innovate and adapt to a new set of conditions .. conditions which are rapidly on their way to becoming ubiquitous and/or expected by the generations entering or approaching their chapter-of-life in the workplace.

It sometimes feels like this is only the next round or wave of coming to terms with rumblings and dynamics that began back in the ’60’s and ’80’s.  After all, we began hearing about the critical need for empowerment, continuous learning, flexibility, agility and resilience at least two decades ago.  Most of the pioneering work in these areas came from the soft-and-squishy (or seen to be that way) world of Organizational Development (OD), from people like Eric Trist, Fred Emery, Bill Passmore, Marv Weisbord, Peter Block, Charles Handy, Meg Wheatley and many many others.

As the years have passed since these pioneers first addressed the human issues in organizational structures and processes derived from engineering and efficiency principles, various elements of their thinking and practices have inexorably found their way into managing processes and people.  I suggest that this is entirely understandable as the increasing frequency and intensity of complicated and complex organizational activities have grown over time, and along with the evolution of peoples’ expectations about work and meaning in a modern era.

My premise is that management innovation is available  from that world of organizational development, as it’s principles and dynamics are closely aligned to Hamel’s suggestion that “activities will still need to be coordinated, individual efforts aligned, objectives decided upon, knowledge disseminated, and resources allocated, but increasingly this work will be distributed out to the periphery“.

The New Context Demands New Principles

What was yesterday called Enterprise 2.0 and today is called “Social Business” can be seen as the emergent stage of the intersection of significant advances in information technology, management science applied to business process, the analysis and control of operational activities AND the interaction and participation of people with information, opinions and knowledge to share.

These forces and factors are converging in today’s workplaces, wherein a continuous flow of information is the rule rather than the exception.  Thus, it’s essential to cast a critical eye on the fundamental assumptions of work design and how work is managed. The core assumptions embodied in widely-used methodologies today still present work as  ”static sets of tasks and knowledge arranged in specific constellations on an organization chart” (see all major job evaluation methodologies for more detail).

It’s getting clearer and clearer today that the capabilities and dynamics of what started in the consumer realm as social software … those funny things called blogs, and wikis, and widgets stitched together into and by web services … are finding (and have found) their ways into the workplace.

That they have migrated to the workplace makes sense.  People have always  (at work) been creating and building up “... knowledge through exchanging information, talking and arguing and pointing out other ideas and sources of information and ways to do things.” Such services and tools and the reasons for which people use them are the means by which general human activity (purposeful and otherwise) translates to the online environment.

So, as stated at the outset, it seems clear that we’re situated in a more interactive, less static environment.  Whether we like it or not, we are  passing from an era in which things were assumed to be controllable (able to be deconstructed and then assembled into a clear, linear, always replicable and thus static form) to an era characterized by a continuous  flow of information.  Because it feeds the conduct of organizations large and small, it is a flow that necessarily demands to be interpreted and shaped into useful inputs and outputs.

The methodologies still in use today generally did not foresee working with networked information flows, and thus the way work is designed and managed does not really address how it could or should be managed.

We need to revisit the fundamental principles of work design AND the basic rules used to configure hierarchical organizations in which the primary assumption is that knowledge is put to use in a vertical chain of decision-making.

Both Horizontal and Vertical

Horizontal flows of information and peoples’ engagement have already been put to work in a range of early Enterprise 2.0 and Social Business experiments.  But let’s be honest .. how these will work, or not, is to date less than clear.  There’s an enormous amount of inertia and habit to overcome, all whilst confronting continuously turbulent conditions seasoned with healthy helpings of ambiguity .. about economics, governance and peoples’ collective capabilities to adapt.

Hierarchy is not disappearing from the organizational landscape .. nor should it. It’s an useful construct for clarifying decision-making and accountability, and I believe it will come to co-exist with the core dynamics of networked people and information …

“a dynamic two-way flow of power and authority based on knowledge, trust, credibility and a focus on results”

.. which, incidentally, is a fundamental aspect of all the ‘democratization’ (it’s probably too early to yet call it that, but let’s do so for the time being) we are witnessing in the recent uprisings in North Africa and the Middle East.  Would that our western governments and organizations watch and learn as they embark on the renewal of leadership and management in the 21st Century.

The implications are huge, will demand significant effort and responsibility on the part of all individuals, and may lead to very different ways of working and being in and of the world.

But clearly, we must evolve … what we have been doing looks less and less likely to be as effective as necessary in the rapidly-approaching future.

Much of our discourse about the New Enterprise seems to use the premise that our traditional business organizations will be transformed.  I am beginning to doubt that. But I think that there is a new Enterprise but that it will look more like that I propose in this post.

All the news about employment remains bad. Will the jobs ever come back? I don’t think so. Business as we know it makes less and less and in reality offers fewer roles and jobs that have any meaning or that can pay todays bills. Business  as we know it has no capacity to offer most people what they need.

I think that the real new economy is going to emerge out of desperation and out of this failure.

Here are some trends that we should watch out for. They are all  linked into the great Trinity of real needs – Food – Shelter and Surplus

Hyper Local Food - If you have no money, food becomes very important. The Food Bank model takes us no where – it relies on charity – offers shit food and does not add any impetus to the lack of work or role. People are doing better than this by making the growing of food the centre piece. Here is an example. We see already in the worst hit cities like Detroit, that people are starting to grow their own food amidst the ruins of the city. And its not just that food is grown but that real community is created. People who grow food together and then share it return to the society of our hunter gatherer past. They become Tribes. With this Trust comes the potential to do more.

Cheap Land and Real Estate – As many areas become blighted, the land and the space becomes very cheap. Offering the opportunity to get the second part of the  trinity. In the old model, people would have to pay others to make shelter or working space. But if enough Trust is created by say starting with co growing and sharing food, then “Barn Building” is possible. The “Tribes can help the members have shelter or work space. The capital that is required is less financial capital but social capital.

Surplus – But we still all need money or some way of exchanging value outside the Tribe. This is where the social web comes in. There can be a surplus of food that can be sold locally. Inner Detroit is a food desert. There are only corner stores. This is true for many urban areas. The food operation can scale and can also network with others offering in the end large scale. 1,000 mini farms in a large city can produce a very large amount of food collectively. Enough to feed most people. A real surplus is possible. Those who start to grow food to feed themselves will make a good living feeding other. With this surplus and with their social capital all sorts of new ventures then becomes possible. For the capital costs of business in this context are very low. Anything will soon be able to be made locally with very little capital. This trend is most visible in the media now. Did you know that True Grit was edited by the Coen brothers on Final Cut Pro,? The technology is here right now that can empower a small hyper local group to go even into manufacturing. Here I see the idea like Fab Labs coming into prominence. For about $25,000 a community can equip itself to make almost anything. As with a network of tiny farms, a network of tiny shops can build on a large scale. This was how in fact Germany kept its war production growing throughout WWII. To avoid bombing, all aircraft production was dispersed into small shops and the parts were assembled at the bases!

Again as with food – the social web connects all of this. Producers to Buyers – Suppliers to producers – Producers to Producers. In a network  the nodes are small, but the network and so the output and the opportunity can be vast. In the old, we all depend on the MAN. In the network we are all the man. No one is going to move your urban farm to Iowa or your Fab Lab to China.

Food is the starting point I think. We all need it and if we go down this road we re-invent society. Food offers us the core of what we need and growing it and sharing it creates a real tribe. For a food model like this brings us all back together where as the old model splits us all up.

So with this wealth model come also wealth distribution. A new better form of capitalism. Capitalism 2.0?

Everybody’s talking about social: social networking, social CRM, social-this, social-that. It’s all just noise to me. We’re social. Get over it. It’s redundant. It only has to be called out because the stupid technology wasn’t designed for real people. We get it already.

Heck, I’ve even been blathering about transparency, bladda, bladda. While all of this is still relevant, I now see the value in fine-tuning our focus just a bit. The real potential — the power curve — is in focusing on sharing.

Sharing is something that comes naturally to people — we want to help each other. Indeed sharing is at the top of the list in All I Ever Needed to Know I Learned in Kindergarten.

Working with each other ensures the survival of the species. It turns out that survival of the fittest isn’t just about strength, power and the ability to overpower others by competition — everyone for themselves — but that truly sustainable species rely equally on cooperation, or social sharing.

What we see in the wild is not every animal for itself. Cooperation is an incredibly successful survival strategy. Indeed it has been the basis of all the most dramatic steps in the history of life.

Business cultures are ripe with language and actions of competitiveness. Many seek to ‘protect turf’. These behaviors are relevant during times of duress and/or limited resources. But embracing such language and mindsets can actually create duress and serve to unnecessarily limit the potential of existing resources.

A very telling visual representation of the limits imposed by such mindsets is the chart grabbed from a TED presentation by Johanna Blakley who spoke about the real issues that Intellectual Property protection impose on creativity and growth. [Thanks to @jorgebarba for sharing]

On the left are the 2007 Gross Sales in US $BIL of industries with low IP protection, on the right are the high IP. The evidence is staggering. Johanna also created her own chart to lay out a comparison of common items and where they fall into a copyright scheme.

Indeed what most intrigued me was when Johanna made the subtle distinctions between the idea and the expression thereof. We’ll just leave that as a pending topic to explore further, another time.

We’ve talked about IP on this blog before. The topic had high visibility at FASTforward ‘08 with a banner exclaiming (a quote that appears to be attributable to Bill Gates): “Intellectual Property has the shelf-life of a banana.” Heck, I even remember the most significant change I noticed in Bill Gates demeanor toward his competitors (even in close range on panels at Gartner conferences where the analysts relished stirring up trouble), when he exclaimed (paraphrasing):

I learned, this isn’t a zero sum game. When my competitors make money, I make money too.

And in a panel I hosted at FASTforward ‘08, I recall the most significant points brought up, related to IP and the negative implications in our changing environment:

• It’s both expensive and time consuming to actually protect intellectual property
• The rate of turnover of products is increasing at a rate that the window of opportunity to protect them is becoming shorter than the time it takes to do so
• The costs to protect IP are rising at a faster rate than the potential earnings to be gained

[Kudos to @jhagel @jobsworth @jmcgee and @billives for BE-ing the panel, and to @skemsley for covering it. I find it none-too-coincidental that they're all active on Twitter.]

Even the almighty dollar (euro, yen, etc.) is wielding its influence on concerns over publicly-shared infrastructure as companies rethink their opposition to operating in the cloud.

Enterprise 2.0 seeks to shift the balance away from oppressive, limiting cultures by facilitating open, sharing ways of working and ‘being’. Even in cultures where this is not the norm, E2.0 technologies and approaches will allow for the natural working and sharing tendencies of people to emerge and return the critical balance needed not just for sustainable survival but for productive striving (another great s-word).

The question that kicks off this short four-minute video:

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Is Social Media a Fad ?  Or the biggest shift since the Industrial Revolution ?

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Thanks to Euan Semple for surfacing this recently-updated (current statistics) view of the spread and penetration of social media into our daily human activities.

It’s not hard to imagine similar patterns to the growth of social computing and informal, socially-driven learning for the average organization 5 or 10 years down the road.

Organizations everywhere will have to come to terms with the ubiquity of social tools, the fundamental necessity of personal knowledge management as a core element of productivity, and more useful-and-easier ways to create effective business processes in a networked environment, whether Barely Repeatable or Easily Repeatable.
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Ed Lawler is a reknowned management thinker I have studied for years.

He was just interviewed (by Karl Moore, a management professor at McGill University) for the Toronto Globe and Mail on the need for new management models in the Interconnected Era.

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New World Needs New Management Model

Karl Moore: This is Karl Moore of the Desautels Faculty of Management at McGill University, talking management for The Globe and Mail. Today, I am delighted to speak with Ed Lawler, who is a professor at the Marshall School [of Business] at USC [University of Southern California] and the director of the Center for Effective Organizations. Good morning, Ed.

Ed Lawler: Good morning.

KM: Ed, you told me earlier that you are thinking about a book on Management 3.0. What do you mean by Management 3.0?

EL: Fundamentally, we need to think of a whole new approach to managing complex, large organizations. We certainly have the “command and control” era, which started way back with scientific management, and progressed over decades, really, to greater and greater levels of sophistication and expertise in how to make it run. That seemed to fit a certain kind of production-driven economy.

Clearly, starting in the 1950s, we began to say it has its limits, we have to use our workers differently, our employees differently, and I think that generated Management 2.0, which was around employee involvement, participation and moving more knowledge and information and power downward in the organization so people could add more value. And I think generally, it did impact the way most corporations operate.

The problem, of course, is that I think we are yet in another era. The economy has changed radically since then, the work force has changed radically since the sixties and seventies, and of course the economy has changed … globally, and everybody knows all those points.

So it’s kind of surprising, in many ways, that Management 1.0: command and control, or Management 2.0: high involvement or high performance, and various names for it, were [still considered] suitable.

I think we do need a Management 3.0, which recognizes the impact of information technology, different work forces, diversity in the workplace, and so forth.

So what I have been trying to do in a new book is say what that looks like, and yes, I have incorporated certainly some of the things that we did in Management 1.0 and Management 2.0. I think it really has to have a different philosophy and a different orientation with respect to both organizational design, how we treat the work force, how we think about the work force and basically how we lead in this kind of economy and in this kind of competitive environment.

KM: Ed, that is very interesting, but I need to know more about 3.0. What is it? Tell us about it so that we can begin thinking about it as managers.

EL: In many ways, to zero in on it, you can pick particular areas on how you would do that differently, or how you would manage, or general philosophy. Let me just pick one and carry it out: leadership, for example.

With the movement away from command and control management to high involvement management, we became fascinated with leaders and ascribed a lot of the effectiveness of organizations to the behaviour of leaders and so forth, and I think that has gone way too far.

We have lost a lot of the managerial blocking and tackling that people in supervisory positions have to do in order to make organizations effective. It seems to me that, if you are going to have a valid, viable 3.0, it has to include the right blend of leadership behaviours. Yes, where you inspire people by a sense of mission, sustainability, accountability – but also have a valid management approach which deals with fundamentals like goal setting and work specifications and product evaluation produced by employees. So we do not want to lose some of the key managerial skills as we have, I think, in searching for these magical leaders who are going to inspire and direct people.

KM: It is kind of a balance between leadership and management in these people: You have to be a leader but also, if you are not a manager at the same time, I think it’s Henry Mintzberg who talks about it, it’s dispiriting.

EL: Yes, I think that is exactly right, it is the balance. We have spent a lot of time training people on leadership, which some people learn and some people don’t, to be frank, and we have lost a lot of the fundamental manager skills or [they] were never developed. We still see managers doing terrible basic management – like performance reviews are done just awfully and the answer seems to be, “Well, let’s just eliminate them.” Well, to me, that is just insane. How are you going to direct and control behaviour if you do not have some kind of accountability and some sort of reviews that look at people and give them feedback and give them a sense of direction?

Just knowing that we are going to [have] sustainability as a major thrust of the company does not translate into day-to-day behaviour very easily. You need to be able to make that translation from the sense of vision and mission and so forth, to actual behaviours, and that is the managerial part of being an effective manager and leader.

KM: How about how we design organizations? How would that be different under 3.0?

EL: I think it depends substantially on what business you are in, how sophisticated the business is, and how complex it is, but I see much more self organizing, much more use of information technology, social networks, and perhaps even internal markets to create the forum and allocate financial resources within organizations, and that’s an area where there would be enormous differences.

In a book that Chris Worley and I did called Built to Change , we emphasized very strongly structures that would give people external interface with the market so that nobody is more than 2 or 3 degrees separate from the external market. I think that’s the right emphasis and we need to build on that kind of thinking because touching the market, being interfaced with the market, helps direct peoples’ behaviour internally and gives them a sense of how the business is doing and certainly motivates them to perform well.

So, I think that piece of the design is critical. What I don’t think we did enough with, in the Build to Change book, is to emphasize how organizations can be built out [using] social networks and how money can be allocated to innovations and start-up operations and how they can be converted from ideas to actual operating businesses.

KM: Is that something like the Wikipedia-tion, the LinkedIn, the Facebook-ization, if you would, of the world?

EL: Yes, I think it is, and that certainly relates to why I think it’s viable now and has not been in the past, and it has to do with a lot of people coming into organizations, partly the younger group, of course, but also more senior people are now much more familiar with those technologies and it is much more viable to use those technologies to organize.

So you are starting to see large companies, like the Ciscos and the IBMs, trying to take that technology which they have sold to consumers and say “How do we use it internally to create a more adaptable and flexible organization?” The one thing we clearly know is that Management 3.0 has to leave room for very adaptable and flexible organizations so that yesterday’s competitive advantage is ready to be today’s, yesterday’s business model is going to have to be pretty radically changed quickly, in order to keep up with the rate of change that exists today in the environment.

If there is a new normal coming out of the recession, I think it is one of change and one of innovation that companies have to be able to do that. Particularly if they are in knowledge work or situations where intellectual property and technology is the key to their business.

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Read the rest of the interview here …

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Once before, at a time of great change – the Ending of the Ice Age – Mankind used Emergence to not only come through but to take a new place on the planet. Don’t we face the same kind of challenge today? Is not Emergence our best chance?

We have so little time that if we are to face our challenges directly and use Emergence as a process, that we have to know what to do. We have to know the science and hence the predictable rules?

Because we know the rules for electromagnetism, we can use them to change our world. My bet is that we we know the rules for how best to use the social energy of people, amplified by social media, we may change the world even more than when we first amplified our group potential when we acquired complex language.

Then we created consciousness.

We were able to discuss novelty into being – the very essence of Emergence. And for most of this time, all of this happened like this – face to face in small groups.

What might happen, if we can expand our circle from face to face to a global conversation but with the same intimacy? If the result 60,000 years ago was so momentous then – what might be our destiny now?

With our place in the world in such jeopardy, global warming, resource shortages, peak oil, political logjams – we don’t seem to be making any progress with our current way of “seeing” and “acting”. I wonder if our only hope to “see” our place more clearly and to “discover” solution that will work is to press for a larger process of Emergence. If we could harness a global conversation, what might be the result.

In parts 1 and parts 2 – I have done my best to offer a directional approach to this voyage of discovery.

Now we come to the hard part. What are the rules. For if social energy is as real as electro-magnetism, it will have rules.

That once we know them, we can make a break from mere speculation, techno babble and kumbya and design in the full power of social media to make this great link up that it offers. Then we can get to work.

In the prior posts, I have talked about the utility of this way of seeing the preconditions for human emergence.

We need a Container – the Circle of Concern. We need inside this a boiling mass of many connected points – the Circle of Influence.

We need to know what are the rules to produce the best container and the best circle of influence within it.

The Rules for the Container – What makes containers more powerful than others?

The container is a force multiplier. Like a boiler – the more pressure the more force and hence work. The ideal container is then an energetic multiplier that brings into play the full energy of human beings. All of them and every part of them.  It creates complete alignment and hence the full energetic force becomes available. So what does our observation tell us about when is their an event that brings all of people and all people together as one? Usually it is when we are at war – in a war of survival – like WWII.

Observation reminds us that Tribal Survival is the ultimate Circle of Concern.

So what in the modern era is Tribal? I don’t think that it is a group of sports fans. They are bonded by a conformity and by identifying with what others do. In a way sports fans may be people who would like more of a cause but have no other choice in the drab world we live in. It’s not the work force of a traditional organization. There is not enough equality in the rewards or risks. Also there is too much conformity demanded in most traditional organizations.

For we can also see that conformity is death to emergence. It was the added diversity that made up the gains in the last months of the Netflix prize. Really new ideas are by nature disruptive. Too much conformity hates disruption.

It can’t just be the folks on the web we feel most comfort with as well – for the same reasons of diversity. The Echo Chamber is where we get stuck in a repeating loop. We know that most disruptive ideas are mergers of other views and ideas.

A real tribe is much more complex and diverse. Diversity is the critical ingredient. So the challenge is how do you get people who are so different to work with each other?

Shared risk seems to be one way.

Designing social groups so that the risk is real and shared is how many older societies enabled this diversity to have its full power. You can see it in the Shield Wall or the Phalanx. All male citizens were in them. All ranks of society, all professions, all sets of personal values, all shapes and sizes. They were united by a shared danger. They relied on each other to get through this. And behind them stood their wives, their children. Behind them stood their culture and their identity as a group. All were at risk. All had to be contributors.

If you wish to feel this energy – here is a link to the defining moment of the South, as Lew Armistead gives the orders for his Brigade to begin Pickett’s charge. They fight not for slavery but for all they have. For “Virginia” known as “Our country”. In the scene preceding he shows the British officer the diverse nature of the men there that day – from aristocrat to farm boy – all points of view – all sorts – united as brothers “All Virginia is here” Armistead says.

I think that such a mix – diverse – contributing/participative – high stakes for all – makes the most powerful containers for human emergence. Don’t we live at a time now when this is again true? For if we don’t do the right thing, is not all at risk?

Tribal Issues defined like this make the best containers – the more that the threat is immediate, widespread and dangerous, the more power it has to produce the preconditions for emergence. The more that people can see that they can and should act themselves, the more that this energy is maximized.

The more the issue is truly life or death for the Tribe – the more contextual and rooted in the soul of the people  – the more that the solutions are participative the more powerful the container.

We don’t have to go to war to find this energy. What about people living in Detroit now? What about California? I am seeing that there is a group of people, with their backs to the wall, who have stopped looking “out there” for help. Who will not run. Who are going to create something themselves. They are banding together into a circle of concern that is “Their Country”.

I was in a meeting last week with some people who were telling of colleagues who were tired of the low risk route. “I want to die on a hill” said one. I don’t think he really wanted to die – but he did want to be connected with people in that way. Don’t most of us long for this kind of commitment. With it, trust is so high that emergence is possible.

Trust – real trust – comes from shared risk and shred experience in risk. With very high trust comes openness and with enough mass and enough openness comes emergence.

In summary here appear to be the rules for the optimal “Container” or “Circle of Concern”

• Tribal survival – where all are at risk and all can be rewarded – this then goes on to allow
• High levels of Trust – this goes on to allow
• Maximum Diversity – this then sets the conditions for
• Emergence

So now what might be the rules for the Circle of Influence?

The Rules for the Circle of Influence – What makes influence more powerful?

We know what the Circle of Influence has to look like – It has to look like this.

For emergence occurs in scale free networks and this is what they look like. So we have a check point – if your Circle of Influence does not look like this – it is not optimal.

Note that they have hubs of major concentration of “influence” (All these great slides come from Ricard V Sole’s – ICREA-Complex Systems Lab, UPF, Barcelona & Santa Fe Institute, USA talk at ECCS at Jerusalem Sept 2008). So we can expect our human energy networks to have this pattern.

The Circle of Influence is not an undifferentiated mass of people and connections. It will be made up of fractal clumps of “cells” that will lean towards being optimal in influential power. So it will not be about having 5,000 Twitter Followers but it will be about what is the ideal number to have to maximize influence.

Not this- You and masses of “friends”

But this – You and a a few close friends connected to other close friends in a huge scale free network

Another view of Scale Free – Thanks to Valdis Krebs

So the pattern is clear. It is lots of small networks hyper linked to others. We also know from the brain that the more links the better. Linking is good. More is better. Best is the most possible.

But what about the detail – how big are these cells and what are they like inside?

The answer to how big is not very big. We know how big is ideal and we know why as well.  All these little sub-networks are ideally bounded by the Magic Numbers of Fibonacci. Here is the most complete review of this new science of the nature of ideal human connections that I have been able to assemble

Here is Chris Allen’s research into group satisfaction:

Here is his observation about Guild sizes in WOW

We know what groups work best and under what circumstances. 8 is the ideal group where we find the tightest connection in the largest group. 144 is the maximum – likely that the power of the connection is much weaker at 144. Where is the most leverage? Likely at 34. This may be where the connection is tightest versus the reach. 2 – 3 – 5 may be too tight and too close?

Across all militaries the ideal unit sizes are:

• 8 – Squad/Section
• 35 – Platoon
• 150 – Company

There are thousands of years of experimentation involved in these numbers. They are not made up they have emerged!

So these numbers seem very small to all those that have 15,000 Twitter followers and think that they are connected. How do such small groups have the power to have massive influence?

I think the key rule here is “Influence”. Not Malcolm Gladwell’s idea of a few people who have a lot more influence that the rest of us – though I still know there to be merit in that.

I think that we come back to Trust again. If you are a real friend of mine and you ask me to look at something or to do some thing, it is a good bet that I will say yes. The rule then is to find the sweet spot between reach – total numbers – and influence – how much we trust each other.

Even small groups have a lot of total influence. H\here is an example of the reach if we assume that each of our “friends” has 4 friends

2 – 16

3 – 82

5 – 625

8 – 4,096

13 – 28,561

34 – 1,336,336

55 – 9,150, 625

89 – 62, 742,241

144 – 429, 981, 696

With 34 I can reach 1.3 million with a lot of power of influence. With 144 I can reach 429 million but I have doubts about the power of the influence.

Even with 8 I can reach 4,000 and be assured that I will have a lot of influence.

With a scale free network, it may be better to think small but to work to ensure that we have the best connections.

So here we come to the biggest challenge – Emergence demands diversity as well as connections. We can only trust people like us. If all our “friends” are in the echo chamber, we lose the chance. How do we make connections to other cells out there who are not like us? Even harder, how do we make Trusted connections to people not like us?

For true diversity is not about race or color but about values. Way out geeks or creative people don’t care much for money or efficiency. Hey many don’t even know what day it is. Those who need to win look at nurturers with contempt. Those who care about how things work and about people are mystified by people who don’t.

This is I think the most challenging part of the “Rules” and fortunately, my pal Stuart Baker may have found the answer here as well.

If we have a true survival situation, then we tend to get alignment. But what about a less do or die situation? Also even in a do or die situation how do we reduce the friction of the essential diversity.

Our bodies are very diverse and full of many separate and even opposing processes and entities. But there is a design that regulates the system to trend to homeostasis. Not a God – not a parent – not a CEO – but a simple regulating process that BALANCES the system.

In genetics, P53 is the “governor” of the system – it is the mechanism where the system defaults to homeostasis – it “moderates” or “facilitates” the interactions.

We have to find the “Governor” that will enable the different parts of the human soup get comfortable getting connected. Stuart Baker starts with an extremely simple model of what the gross differences are in the human mindset that makes up the full diverse human experience. It looks like this:

Humans can be grouped into 3 realms of mindset. Of course this is a very simple view but this is how science works we have to start here with simple. I will confine myself to the positive – there are shadow sides to these archetypes as well.

Pioneers – a few of us love ideas more than anything – no guesses as to who I am. We live in our heads. We would rather work for free if it meant that we could do more thinking and exploring. Organizations find us hard to “manage” – we tend to be quite fragile emotionally. We tend not to think enough about how people feel. We are intellectual – in that our minds are where we spend most of our best time. We look to the new. Creating the new is our most important thing. We hate the mundane routines of life. Often found in academia.

Nurturers – there are lots of us here – my wife is one thank goodness for me. We look out for others as a priority. We defend the hearth – many soldiers are here! We do for others – this is not just emoting. We are pragmatic in our care. We want to help people become all they can be. (The dark side is that we want to make people dependent on us)We are relational – in that we spend most of our energy on relationships. We are traditionally conservative. The new scares us. Protecting is the most important thing. Often found in government.

Providers – We bring home the bacon. We are very action orientated. We take care of business. We tend not to be very empathic. We tend to be transactional. We find most thinkers too airy fairy and we find many nurturers too whiny. We are active – we need to WIN. We don’t think much about the future and we need to get our information in simple chunks that we can act on right away. We spend most of our time competing. Winning is the most important thing. Often found in business.

Do you see yourself here? You can also see why it is so hard to get out of the Echo Chamber. What Pioneer feels good with the typical no sayer of the Nurturing type or the trivial mindless focus on winning today of the Provider? You can see my bais but please insert your own back – that is my point – this is a hard mix to bring together.

This is why survival is one of the ways of doing that.

But what about day to day life? How can we bridge and balance these opposing groups?

Here is Stuart’s huge insight. That this pattern is of course Fractal.

Inside each of us is a fractal of the whole. Like atom forming into molecules, we can see the linking and the bridging points.

In the Pioneer realm there are Pioneers whose tendency is either to Nurture or Provide. In the Nurturer and Provider realms there are those who tend to the other realms.

So then there is one more step to optimize the balance in this system.

This is a model of a client of mine – the PEI BioAlliance. A Cluster/Emergence Making Network of “cells” with a Circle of Concern of using research into how nature works to improve the economy and society that is PEI.

What we discovered was that we had to add the equivalent of P53 to the mix. The BioAlliance Inc – that lives in the Nurturer Realm – is a small 3 person organization that “facilitates the balance of the system. It Holds the Space. Its director is not the CEO – he is the Facilitator. He is responsible for maintaining trusted links and for creating the habit of trust based on the continual experience of its value in the day to day interactions of the group.

If you wish to know more here is a link to the story of the early trials and failures and the ultimate success of this venture.

In the centre is a board made up of all the parts and all the realms. Here issues of trust are worked out and here is where the larger value of the whole is often realized.

So ideally a p53 – a system facilitator ideally should be designed into a network that seeks emergence. This is what allows the most important aspect of all – there must be the full diversity of being human in play for the best emergent results. All 3 realms must be aligned.

Here is how Dr Chet Richards – John Boyd’s St Paul illustrates the challenge.

We have to use facilitation to get heree:

Whew! This is a long post and I have only really scratched the surface. So let’s close now with a summary.

• The optimal Circle of Concern will be about Tribal Survival – all must be in the zone of risk and reward
• The Circle of Influence – has to be a scale free network – no other design replicates nature’s precondition
• The Circle of Influence ideal cell size is small and relies on the links to scale – there is a design of reach and pull to optimize here – it will be found in the Fibonacci sequence
• The Circle of Influence must be diverse – we have to get out of the echo chamber – ideally all three realms must be balanced and included – this is very hard to do
• To get the best alignment/balance – we need a balancing agent/facilitating agent/p53 – this lives in the Nurturing Realm and must be very small – it is an agent not a CEO
• The live blood of an optimized system is Trust

I am going to take a break and then talk more about how this might be put in place. I will use 2 case studies and Stuart and Rory Francis and I are starting to make some short films about this too.

For those that do not know – Netflix held a multi year competition to find a better search and ratings system – many teams competed.

In the final stretch the breakthrough came when many of the teams joined forces – the big difference was made by adding teams that up to then had “got it wrong”. A great story of this competition is on Wired.

The secret sauce for both BellKor’s Pragmatic Chaos and The Ensemble was collaboration between diverse ideas, and not in some touchy-feely, unquantifiable, “when people work together things are better” sort of way. The top two teams beat the challenge by combining teams and their algorithms into more complex algorithms incorporating everybody’s work. The more people joined, the more the resulting team’s score would increase.

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“It’s been quite a drama,” said Netflix chief product officer Neil Hunt at Monday’s awards ceremony. “At first, a whole lot of teams got in — and they got 6-percent improvement, 7-percent improvement, 8-percent improvement, and then it started slowing down, and we got into year two. There was this long period where they were barely making progress, and we were thinking, ‘maybe this will never be won.’

“Then there was a great insight among some of the teams — that if they combined their approaches, they actually got better. It was fairly unintuitive to many people [because you generally take the smartest two people and say 'come up with a solution']… when you get this combining of these algorithms in certain ways, it started out this ’second frenzy.’ In combination, the teams could get better and better and better.”

Ironically, the most outlying approaches — the ones farthest away from the mainstream way to solve a given problem — proved most helpful towards the end of the contest, as the teams neared the summit.

For instance, BellKor’s Pragmatic Chaos (methodology here) credits some of its success to slicing the data by what they called “frequency.” As it turns out, people who rate a whole slew of movies at one time tend to be rating movies they saw a long time ago. The data showed that people employ different criteria to rate movies they saw a long time ago, as opposed to ones they saw recently — and that in addition, some movies age better than others, skewing either up or down over time. (Finally, someone has explained why Snakes On A Plane seemed more fun at the time than it does now.)

By tracking the number of movies rated on a given day as an indicator of how long it had been since a given viewer had seen a movie, and by tracking how memory affected particular movie ratings, Pragmatic Theory (later part of the winning team) was able to gain a slight edge, even though this particular algorithm isn’t particularly good at predicting which movies people will like when run on its own.

Another example: According to Joe Sill of The Ensemble, Big Chaos (the Austrians who also became part of the winning team) discovered that viewers in general tend to rate movies differently on Fridays versus Mondays, and certain users are in good moods on Sundays, and so on. The team essentially devised a three-dimensional model that incorporated time into the relationship between people and movies.

Taken on its own, the fact that a viewer rated a given movie on a Monday is a horrible indicator of what other movies they’ll want to rent — a crucial part of Netflix’ business (it says its recommendations are better indicators of what people will rent than their “most popular” lists). But combined with hundreds of other algorithms from other minds, each weighted with precision, and combined and recombined, that otherwise inconsequential fact takes on huge importance.

“One of the big lessons was developing diverse models that captured distinct effects,” said Sill, “even if they’re very small effects.”

This approach is the opposite of how we have been taught to solve problems. There has to be a plan and a few smart folks working to the plan.

What I see here is the power of setting in place the conditions that allow for “emergence”.

Science and Research is going to explode by going down this path.

What will be needed are great supporting tools – watch this space!

“technology…processes by which an organization transforms labor capital, materials, and information into products and services of greater value.”
Clayton Christensen, The Innovator’s Dilemma

Technology?

The term “technology” is as misused as the word “diet”. Anything you eat makes up your diet. You can’t go on a diet, you’re already on one. You can, however, go on a “restricted diet” or a “reduction diet”. The key modifiers are often dropped.

Andrew McAfee purports that Enterprise 2.0 is “not not about the technology.” Using the Christensen definition noted above, this is true. But is Andy missing a modifier? His writings seem to focus on “digital technology”, which can indeed enable Enterprise 2.0. And yet, many of these technologies have been available for over a decade. How significant then are these technologies and where’s the issue?

Digital technologies labeled Enterprise 2.0, will not provide 2.0 results if implemented with 1.0 thinking.

2.0 Thinking: Embrace Dichotomy

How is 2.0 thinking different? It relies on a shift away from many commonly held beliefs. It is not an abandonment of such beliefs, but requires that they be suspended to move to a more flexible, adaptive middle. It requires the ability to embrace dichotomy, to simultaneously consider opposing concepts to find new possibilities (see “The Opposable Mind” by Roger Martin, Rotman School of Business and “The Innovation Paradox” by Richard Farson and Ralph Keyes).

Digital technologies are, well, fundamentally digital. They operate off of algorithms and binary code. As such, they provide approximations of reality. But knowledge work is not inherently defined by processes. Forcing knowledge work into processes defined by algorithms and binary code introduces ‘rounding errors’. The more algorithms and binary code you string together into a single solution, the more error you introduce.

The promise of object-oriented theory was to create reusable pieces of code. This was a fallacy. The true potential was not in the code itself, but in reusable functions – algorithms of process (the real essence of SOA).

Consider the following continuum:

Based on observations from Roger Martin, the adaptive middle requires a move away from (not an abandonment of) binary code. The entire continuum is relevant — optimal flexibility synthesizes all of these. Where the dynamic middle falls, depends on the context of the problem or opportunity at hand. Consider the left side Art and the right side Science. Synthesized, they lead to the optimal: context-relevant design.

One discipline that relies on the synthesis of art and science is architecture. While digital architecture might be considered both art and science, Enterprise 2.0 requires a form of Enterprise Architecture akin to, but not equal to the Zachman Framework (frameworks, the conceptual equivalent to technology platforms). No one individual can or should defend the various perspectives needed to shape such an architecture.

Structure Minimized, Not Eliminated

Fundamental to Enterprise 2.0 is simplicity. The most simplistic form in nature is that which emerges, governed by the laws of complexity – the middle between chaos and order (basic premises of complexity science, including feedback loops are assumed and not detailed here).

Emergence is strangled by order and dissipates in chaos. It requires “Small Pieces Loosely Joined”. In his book by the same name, David Weinberger lays out a “unified theory of the web”. Enterprise 2.0 embraces a unified theory of work, celebrating the most adaptive resource a company has: its people.

Enterprise 2.0 unleashes the potential of corporate resources by shifting control. While management does not go away, it is not an activity in the hands of a few.

Gary Hamel suggests, “Management is out of date. Like the combustion engine, it’s a technology that has largely stopped evolving…” Management is not a group of people with a title, it’s “the capacity to marshal resources, lay out plans, program work, and spur effort” and “is central to the accomplishment of human purpose.”

Fluid Structure: Think Lava Lamp

There’s no ‘big bang’ theory. Emergence does not evolve from nothing – it requires structure. Endless possibilities of form emerge from the elements and constraints of a lava lamp. Break the container and the possibilities of the elements end.

Where does structure come from? It depends – this, the ultimate design answer. The right answer comes from the context of the business.

There are no checklists for creating an Enterprise 2.0-enabled environment. The business is already operating. The challenge is akin to repurposing a Boeing 777 into a 787 Dreamliner mid-flight, except there is no ‘finished’ design, but there is a starting architecture (heuristics). Most progress is tested/validated in-flight.

The term “repurposing” should not be taken lightly. Tremendous potential exists for leveraging what’s already in place: “Thus the task is not so much to see what no one yet has seen, but to think what nobody yet has thought about that which everybody sees” Arthur Schopenhauer. One form of this is the mashup, but there are many other ways to leverage existing resources by using pieces of existing designs and solutions or modifying them with new functional or UI patterns.

While digital technologies contribute to the structure, they are only seeds. At the lowest level construct, Blog technology is not different than a Wiki: both provide functions to create and display content in a specific format. The main distinctions in Blogs and Wikis are the functions and formats they provide. But the same is true for all other common desktop applications. A Blog or a Wiki is no more inherently social than email.

Indeed, Blogs and Wikis are common to desktop applications in one very negative way: they can create more silos of information faster. This is the antithesis of the flexibility required by Enterprise 2.0. There must be a guiding architecture for Enterprise 2.0 success, one that separates the UI from the functions, the format from the content and data. A digital technology that earns an E2.0-relevant label, will be built around or support such an architecture, one that understands and leverages the fundamentals of fluid structure.

Architectures rely on operating assumptions: an HVAC system must be kept in good repair to maintain comfortable temperatures for building occupants. Enterprise 2.0 requires some form of facilities maintenance. The evolving details of the care and feeding of the environment can be embodied in a Governance Model, not to be confused with highly regulated models often used for restraint. The E2.0 version is more heuristic than algorithmic, but includes a blend of recommendations and process. It may define formal and informal roles. It simply reflects agreements.

No Beginning, No End

There is no prescribed starting point for Enterprise 2.0, but there is one capability that emergence fundamentally depends on: the ability for people to find each other by things that define relevance – work, topics, skills, affiliations, trust. As well, people must have ready access to relevant ‘raw materials’ for their work. Shorten the distance to finding relevant resources.

To be truly emergent, Enterprise 2.0 must be seamlessly integrated with knowledge work. It cannot be an appendage; it should not require adoption.

Enterprise 2.0 is inherently social. It is not about managing knowledge but is about rendering knowledge. It is enabled by, but is not achieved by installing a digital technology. It unleashes the potential of humans not with workflow, but by flowing work and thought on persistent conversations.

Andrew McAfee released a post today about challenges to his definition of Enterprise 2.0. In it, he made the statement featured in the title here. Because I’ve often stood by the statement that “it’s not about the technology”, I felt it reasonable to share here some clarifications to such a position, as was detailed in my response to Andy on his blog.

Andy: I agree that it’s ‘not not’ about technology. And as I always like to point out, we’d all be a lot better off if we understood and embraced the non-digital aspects of technology, especially as noted by Clayton Christensen “the processes by which an organization transforms labor, capital, materials, and information into products and services of greater value”. But we don’t.

Due to the imperfections in language as a representation, we have to deal with common interpretations. The message “it’s not about the technology” does not infer that the technology is not necessary — it suggests that it’s not sufficient. In a reality where so many see and buy technologies as ‘finished products’, this mindset has to be overcome with a strong perspective. The common belief has to be challenged to start the conversation in earnest.

Yes, the digital technologies hold great potential. But they are ‘lost’ without the balance of all the components that make a sound technology, by Christensen’s definition. Because so few hold this understanding, anyone who is championing core principles must also champion the details of the broader definition of technology, else the story is only partially true. You speak of technology and then you specifically mention software. While software is a technology, not all technology is software. Even if we were to embrace, as you suggest, the technological aspects of Enterprise 2.0, software itself is a small part of it.

“A definition is not a discussion”. I would guess you’re suggesting that a definition is a placeholder, around which discussion can ensue (I believe the ‘contrarians’ are suggesting they’re not seeing a venue for such discussion). The essence of all things 2.0 is the recognition that ‘facts’ are contextual. The purpose of the flexibility that is borne of 2.0 is to accommodate growth and ever-changing conditions that are the reality of business.

Ever-changing has always been part of the business landscape, the difference now is the rate of change — which is forcing us to move away from the side of the Design Thinking continuum where lives “binary code” and “algorithms”, more toward “heuristics” and “mystery”. While there will be conditions for which all will be relevant, the focus has to be more in the tradeoffs between the heuristic and the algorithm. We are constantly learning and seeing things from different perspectives. A definition that is ‘locked down’ would be an embracing of ‘binary code’. That’s just not part of a 2.0 reality which embraces the need to facilitate the dynamic middle — providing the ability to harness the crest of the wave, capitalizing on kinetic energy (energy in motion) and order for free…the birthplace of emergence.

We offer gratitude and respect for your trailblazing this category. As well I offer as evidence other trailblazers: John Zachman originally only had 3 categories in his now 6 category Enterprise Architecture Framework (the other three came from the ‘masses’); Bill Inmon did not embrace data marts as part of data warehousing. Both evolved.

I look forward to the continued growth in our collective understanding of this topic as we seek to leverage its potential and improve the means by which we work together.

The wagons are circling…around the wrong campfire.

Clearly, adoption is an important part of Enterprise 2.0 efforts. The FASTforward Blog team believes it’s significant enough that we’re shifing our focus to the topic. But the language of adoption for 2.0 is broken:

“…coming up with innovative ways to address those three issues to drive end user adoption” Still Looking for End User Adoption

“Reach out to existing communities of interest to drive adoption…” Think Adoption, Not Deployment

“…how a user centric (rather than technology centric) approach to deploying Enterprise 2.0 technologies will drive adoption” Expanding Enterprise 2.0 Beyond the Early Adopters

While some of these authors have introduced critical elements to address — seamlessness via platforms,  work specific, governance & roles — they all use the phrase “drive adoption”. This is the antithesis of 2.0 fundamentals.

If you have to “drive adoption” you’ve failed at 2.0 design and implementation. The fundamentals of 2.0 are based on design that is organic — meets the individual where they are and adapts based on feedback — it emerges. The ‘adoption’ comes from rigorous ‘adaptation’ — it continuously morphs based on involvement from the ‘masses’. If done right, you can’t keep them away…because you’ve brought the scratch for their itch.

Good design work includes research to identify the relevant itches and discovering the possibilities to deliver capabilities right from where individuals already ARE. If that hasn’t been done, even if you’re successful — it’s relative success, you could have done a LOT better. That’s the problem with success — it’s rarely evaluated for potential capitalization (there was X potential and only N% achieved).

From a physics perspective, “driving” is the same as “push” or “pull”. None of these are relevant language in 2.0, as they waste energy (e.g. resources). Tapping natural energies — existing activities — ARE fundamental to 2.0 designs.

Rather than worry about adoption, make sure there has been adequate investment in design with a focus on the ability to adapt.

Adoption follows adaptation (the solution to the individual, not the other way around).

Footnote: The language of living systems is critical to E2.0 efforts. If you’re not conversant in such language (esp. complexity, emergence, self-organizing), have a sit-down with Mother Nature — she’ll set you straight.