A Partnership Economy

Jon Husband, whom I finally had the chance to meet in person this week, sent me a link to a 1999 article by management guru Peter Drucker. Jon tells me that this article helped spark his concept of wirearchy. In Beyond the Information Revolution, Drucker explains the similarities between the printing; industrial and information revolutions. He concludes that we are definitely in a knowledge economy and that knowledge workers, as the only means of economic production, can no longer be treated as employees.

Bribing the knowledge workers on whom these industries [the new ones created in the 21st C] depend will therefore simply not work. The key knowledge workers in these businesses will surely continue to expect to share financially in the fruits of their labor. But the financial fruits are likely to take much longer to ripen, if they ripen at all. And then, probably within ten years or so, running a business with (short-term) “shareholder value” as its first — if not its only — goal and justification will have become counterproductive. Increasingly, performance in these new knowledge-based industries will come to depend on running the institution so as to attract, hold, and motivate knowledge workers. When this can no longer be done by satisfying knowledge workers’ greed, as we are now trying to do, it will have to be done by satisfying their values, and by giving them social recognition and social power. It will have to be done by turning them from subordinates into fellow executives, and from employees, however well paid, into partners.

If you agree with Drucker’s reasoning, which I do, then there is little doubt that industrial management and all that it has created (chain of command, human resources, line & staff, production, etc.) are the wrong models for the emerging workplace. We are seeing some signs of innovation in companies like Google, that give 20% independent research time to their engineers, but there is much more work to do.

The companies and societies that create and master the new models for wirearchy will be the leaders for the next century. However, there is no guarantee that this will happen here in Canada, the US, or Europe. In fact, it probably won’t happen where industrial models and values are the strongest. Look at the working definition of wirearchy and see if your organisation even remotely practices anything like this:

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

3 Responses to “A Partnership Economy”

  1. Michele Martin

    Oh, how I WISH we could do this!

    I suspect that you’re right that those most hard-wired into industrial models will have the most difficulty making the switch. I also wonder if it isn’t also connected to deeper, underlying beliefs that some nations hold.

    I can only speak for the US, but certainly we have a very strong cultural belief that people are “independent” and “on their own” and I wonder if this doesn’t interfere with our ability to even see ourselves as part of an interconnected network of people built on trust. It seems that part of the reason we’ve been so drawn as a culture to “command and control” is because we’ve encouraged this idea of the “independent maverick,” that we, conversely, feel a need to “control” to get him to do the work we want. I wonder if cultures that are built more on a sense of community and interconnectedness will be more successful in making this leap?

  2. Harold

    Excellent question, Michele, and perhaps we may find out in our lifetime. Who knows?


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