Worker Networks

I’ve been reading The Future of Management, recommended by Jay, and would say that it’s one of the better management books I’ve read in several years. The book’s major premise is that industrial command and control organisations no longer work and explains why they don’t work, as well as giving examples of companies that refute parts of the established industrial models – Google, W.L. Gore, Best Buy, Semco.

The authors show how innovation at the operational, product & service and strategic levels only yield incremental results, but Management Innovation has the potential for much greater change. Henry Ford’s management innovations created the successful 20th Century automobile industry.

As I sit on the sidelines of corporatism, having some as clients but not as employers, I see an increasing wave of adventurers jumping ship and becoming free-agents. As much as working as an independent may be exciting and liberating, it doesn’t scale up very well. With an increasing number of free-agents, I think that one area of future management innovation will be the creation of models (and laws and regulations to support them) for networks of independents. It took a while for The Corporation to become the dominant model and the network appears to be the next logical step. Independents now have access to knowledge as well as the same information productivity tools as corporations. They lack easy legal tools to do the equivalent of incorporating, as was necessary in order to get limited liability and access to investment for physical capital. As cooperatives and credit unions changed banking, worker networks may change capitalism.

8 Responses to “Worker Networks”

  1. Christine Martell

    Harold,
    Any idea what these networks might look like? I agree, there is a need. I feel the limitations of being independent small businesses, but have a hunch there is some way to use technology to scale into a new form?

    Reply
  2. Harold

    I think it will be some form of democracy or cooperative. The authors mention the creation of internal stock markets at some companies, that let employees invest in new ideas, either with money or discretionary time. Tools like internal stock markets are fairly easy to build, so we may see more of this “wisdom of crowds” decision-making.

    Look at how the open source community drove the creation of blogs and wikis for collaboration, as they needed better tools to coordinate their programming efforts. I think that the OS community is the first generation of Management 2.0

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  3. Jennifer Nicol

    You need to be on a ship before you can jump it. Wanna-be free agents need to learn their skills and knowledge somewhere. Personal study (whether in school or reading or just goofing around) can take you part of the way. But in my experience, working alongside more experienced colleagues has helped me learn a lot.

    I’m not saying the system works at capacity — I’ve had only a few jobs which offered that sweet spot of personal capacity and motivation with knowledgeable (and patient) colleagues. But I’m in one now and learning tons, which is giving me a new appreciation for the upside of the office.

    In contrast, as a somewhat timid free agent, I only sought work that I knew I could do well — so learned very little new.

    A strong spirit of mutual help could exist in this cooperative model you are advocating, Harold. But in the absence of mutually shared goals, where each has a stake in a project, I think altruistic info-sharing would only go part of the way.

    On a completely different topic, at Cole’s bookstore last night, my daughter noticed your mother-in-law’s book occupying a big chunk of shelf — two side-by-side stacks with the covers facing out, right at nine-year old eye-level. She’s a big Anne fan (OF COURSE!) and was really excited to see it, I think it will be a good birthday present.

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  4. Harold

    Jennifer, I am advocating a cooperative model, but one with shared goals, including making a profit. The current gap is that the corporation is the only model for larger scale business operations. I think that we need new models. I also think that it’s not necessary to “do your time” in a corporation before setting out on your own, as many younger entrepreneurs are showing me.

    As for the Before Green Gables book; it seems to be getting good press, and Budge is off to the UK next month for a speaking & signing tour.

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  5. Harold

    Actually, I’d say that wirearchy is the right model:

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

    Reply
  6. Dave Ferguson

    Jennifer’s commentary made me think that the corporate/new-org dichotomy may actually be, like most things, a continuum. One of Henry Ford’s innovations was the assembly line, but another was hyper-specialization, the time-and-motion attempt to expel variation from the system.

    Then, too, as an entrepreneur you need a certain margin for error. You need to be able to survive accepting the wrong client, or turning down a client, and as a sole practitioner you can only do that so many times. A larger organization tends to have a little more ability to guess wrong, at least in the sort term.

    Not to say the one is better than the other; this is just musing.

    Reply
  7. Jon

    I think Dave’s points are sound, and that there will a continuum.

    for me a point of understanding that (I think) people are coming to is that there can be combinations that incorporate btoh centralization and decentralization, hierarchy and networks .. and that these will increasingly be purpose-built and temporary / time limited .. hence the “two-way flow”.

    Some knowledgeable wags say that we are increasingly living in a “beta” world .. and I think that’s pretty much the case. Solid, intended-to-be-static structures and institutions won’t (as a generalization) fare so well in such an environment.

    Reply
  8. Harold

    That’s the issue, Jon. The corporation, bureaucracies and hierarchies lack the flexibility for life in Beta. We need to develop better organisational structures. I’m certain that it needs to something quite democratic, as democracies are more flexible and resilient than any top-down structure, especially when information flows freely.

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