Harold Jarche

Thriving in networks that are smarter and faster than you are

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industrial era

Many of today’s larger companies have overly complicated, hierarchical structures. As they grew to their current size, control processes were put in place to create efficiencies. To ensure reliable operations and avoid risk, work became standardized. New layers of supervision appeared, more silos were created, and knowledge acquisition was formalized, all in an attempt to gain efficiency through specialization.

These organizations are now facing increasingly complex business environments that require continuous learning while working. Typical strategies of optimizing current business processes or reducing costs only marginally influence the organization’s overall performance. Faster  market feedback challenges the organization’s ability to react to customer demand. Decision-making becomes paralyzed by process-based operations and the formal chain of command. Agility is almost non-existent.

We are seeing growing complexity both inside and outside the enterprise, so can anyone really predict what’s going to happen next in their market? Even most of the world’s economists have been wrong about where we are headed. Looking backwards has not helped us much.

In this complex and connected world we cannot predict outcomes, but we can engage our environments and markets and then learn by doing. This makes constant learning a critical business skill. It requires do-it-yourself learning as well as social learning skills. How can we help people in the organization develop these skills?

Providing good tools and teaching by example is a start. While communication does not equal collaboration, social media have the potential to support emergent work practices. In changing complex environments, it’s not much use to rely on previous best practices. Social media can provide a space to develop new practices. How these tools get used is itself an emergent practice, but if workers are not allowed to practice, nothing will emerge.

In an age when information is no longer scarce and connections are many, organizations must let all workers actively manage their knowledge networks. Systemic changes are sensed almost immediately in an interconnected world. Therefore reaction times and feedback loops have to get faster. Workers need to know who to ask for advice at the moment of need. However, this requires a certain level of trust, and we know that trusted relationships take time to nurture. The default action in emergencies is usually to turn to our friends and trusted colleagues; those people with whom we have shared experiences. Workers have to start sharing more of their work experiences now, in order to grow their trusted professional networks to deal with new and more complex situations. This is called working out loud. It helps build trust.

Sharing complex knowledge in trusted networks does not happen over night. It requires a combination of actively engaged knowledge workers, using optimal communications tools, all within a supportive organizational structure. Continuing to use industrial era structures and concepts will only lead to irrelevance in the network era.

It’s all about thriving in networks that are smarter and faster than you are. It’s all about being utterly screwed if you don’t know what I’m talking about. – Hugh MacLeod

New values colliding with the old

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Friday’s Finds:

friday2

@CelineSchill –“‘I’m only playing devil’s advocate’ and ‘I’m just here to warn you’ should be forbidden sentences. Propose, instead of censoring.”

@tkadlec – “Was asked the best advice to give to someone new to web dev. My answer was to get a blog and write about what you learn—no matter how basic. Writing helps clarify your thoughts & increases understanding. It’s one thing to use a technology. It’s another to be able to explain it.” #PKM

@jamienotter – “‘The business all around was changing, but the mechanisms to manage and support our employees were stuck in a time warp.’ Adobe’s HR chief”

The genesis of a new way of looking at business: Flow is everything – by @sig

The Organisational Hierarchy is kaput – as single purpose executor of the Business Model it requires reorganisation every time you need to get better, an utterly futile exercise most of the time. Replace it.

Managing is a waste of time. Leadership I need, getting out of bed in the morning I can do myself.

The rise and fall of Wired – by @downes

In times of revolution, the Edge is found where the new science is found. It is found in the underground. It is found in rebellion. It is found at the point of change. It is found where new values collide with old. It is found in new understandings of the world. It is found in new senses of self.

The early Wired tapped all of those pulses. The later Wired does not.

When Marshall McLuhan penned The Medium is the Message, he was tapping into the core of the new understanding of the world on the brink of which we all stood. What he said, in essence, is that the content of the information being transmitted is no more important – and possibly less important – than the means by which the information was transmitted.

Hierarchy is Overrated – by @timkastelle –

All of these are examples where everyone is a chief.  The flat organizational structure can work anywhere.  This works best when:

  • The environment is changing rapidly.  Firms organized around small, autonomous teams are much more nimble than large hierarchies.  This makes it easier to respond to change.

  • Your main point of differentiation is innovation.  Firms organized with a flat structure tend to be much more innovative – if this is important strategically, then you should be flat.

  • The organization has a shared purpose.  This is what has carried Second Chance through their tough times – their shared commitment to the women they are helping.  While the objectives may differ, all of the firms discussed here have a strong central purpose as well.

Structures, skills and tools

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In a complex economy, the way to think about the future is this:

  • We can’t predict the future.
  • But we can learn about the patterns from which the future will emerge.
  • In fact, while we can’t control the future, we can influence it.
  • The best way to influence the future is by innovating through experiments.

– Tim Kastelle

The innovative work structures required for complex economies need to be supported by skilled workers with the right tools. We know that sharing complex knowledge requires strong interpersonal relationships, with shared values, concepts, and mutual trust. But discovering innovative ideas usually comes via loose personal ties and diverse networks. Knowledge intensive organizations need to be structured for both. Effective knowledge-sharing drives business value in a complex economy and this requires a workforce that is adept at sense-making.

Content Creation

In what is often called a ‘social business’, capabilities need to be aligned with tools. A core requirement for both knowledge workers, and enterprise tools, is to share what we are learning and doing. Making work more explicit enables the organization to learn. Sharing user-generated content (knowledge artifacts) is how everyone can make tacit knowledge more explicit. Work is learning and learning is the work, when everyone shares. Of course this is more difficult if communications systems do not allow the easy creation and sharing of this content. Tools have to support the work.

Collaboration

Most organizations have tools that support working together for a common objective. Coordinating tasks, conducting meetings that don’t waste time, and finding expertise are common collaborative tasks. Letting workers pick their own collaboration tools can go a long way in getting work done. Having an array of tools is also helpful. Modelling collaboration skills throughout the enterprise is even better.

Cooperation

When people share openly, without any direct gain, knowledge networks thrive and the organization benefits. Cooperative skills include sharing openly with colleagues, communicating effectively, and networking to improve business performance. In addition, social media require new skills, beyond traditional face to face interchanges. Setting sharing as a default behaviour is a good start, but providing tools to enable sharing is also needed. As with collaboration, cooperative behaviours need to modeled and encouraged.

Structures + Skills + Tools

A combination of organizational structure changes, skills development and modeling, plus a suite of tools, can help to create a social business. All three are needed. Focusing on only one or two areas will likely not yield much success. This has been a problem with many social business initiatives which are too focused on the tools, like enterprise social networks (ESN). While an ESN may cover all the facets shown in the image below, workers still need those matching skills. In addition, the structure must support these behaviours on an ongoing basis. It takes all three components.

social-business-tools-skills

Democracy is coming

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“Democracy is neither a gift nor a license; it is a possibility realized through practice grounded in a deep commitment to truth and an acceptance of the responsibility to seek justice for all.” —David Korten

A guiding goal in much of my work is the democratization of the enterprise. Democracy is our best structure for political governance and I believe it should be the basis of our workplaces as well. As work and learning become integrated in a networked society, I see great opportunities to create better employment models. I know that we can do better than huge wage inequalities, generic work competencies, and dead-end jobs.

The Web is the catalyst that could democratize the workplace. The effect of the Web is explained by Yochai Benkler in The Wealth of Networks. He describes the changes that a networked society can have on our governance, economic and cultural structures:

“The networked information economy improves the practical capacities of individuals along three dimensions: (1) it improves their capacity to do more for and by themselves; (2) it enhances their capacity to do more in loose commonality with others, without being constrained to organize their relationship through a price system or in traditional hierarchical models of social and economic organization; and (3) it improves the capacity of individuals to do more in formal organizations that operate outside the market sphere. This enhanced autonomy is at the core of all the other improvements I describe. Individuals are using their newly expanded practical freedom to act and cooperate with others in ways that improve the practiced experience of democracy, justice and development, a critical culture, and community.”

We need to undo our dominant  business models which are the legacy of military hierarchies because they are inefficient, ineffective, and stifle innovation. Not a single major business disaster in the last half-century can be blamed on too much democracy. However, many can be blamed on overly controlling management practices. Hierarchies are only as smart as the smartest gatekeepers. Networks are smarter than the sum of their nodes.

Business models that will allow connected leadership to prosper are essential in a network era. But democratic leadership depends on an educated and informed citizenry. While we may have easy access to information, we still need to continue with the education, especially social learning in peer networks. We need to learn how to change the rules of the game, because work is just a game, with man-made rules.

“For the vast majority of us who sell our labor in the marketplace, our economic insecurity and relative powerlessness impel us to play by the rules.” —Thomas Homer-Dixon

Perhaps the most effective business model for the Internet age is free agents working within a peer network. As tenure was essential for academic freedom, so an unfettered labour model may be necessary for effective connected business. In addition, imagine what kind of societal benefits would ensue if all individuals had the rights of today’s corporations? Given the loss of mid-skill jobs, outsourcing of labour, and the increasing wealth of the 1%, it’s time for a change in how work is done and wealth is redistributed. Those who sell their labour now have the ability to easily connect, learn, and do.

“The darkest places in hell are reserved for those who maintain their neutrality in times of moral crisis.” —Dante Alighieri

It is time to bring democracy to the workplace on a large scale. Democratic workplaces do not divide labour and capital. Democratic workplaces are the real social enterprises, because they are open. The democratic workplace is how business can finally catch up to society.
liberty leading the people

Open – Review

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“How do our minds cope with the torrent of information coming at us from every angle today? How do we convert so much knowledge into socially productive wisdom? What can we do to close the gap between those who have access to open learning, and those who (still) do not?

The genuine democratisation of knowing is still being fought over.”
– David Price in Open: How we’ll work live and learn in the future

I really enjoyed reading “Open” as it flowed well and was full of interesting stories, all bound into a singular framework. The core of this book is David Price’s SOFT model and I have highlighted some components in this summary table, with further explanations below.

Open SOFTSociety

A Global Learning Commons is “… essentially a shared resource, which works through carefully balancing rights and responsibilities. As it is with air, or water, so should it be with learning. Your right of access to the knowledge and skills of others is balanced with a responsibility to share what you can offer.”

Three characteristics of a GLC are participation, passion, and purpose. “The enthusiasm and ability of small groups of self-organising citizens to respond to respond to challenges makes bigger, better funded, organisations look slow and cumbersome in comparison.”

Business

“A commitment to sharing radically alters the culture of organisations.” On the subject of open for business, the CEO of Ingenious media, an investment and advisory group, states, “The reason why we don’t worry about giving that knowledge away is because most people can’t implement what they know. The capital value of something these days is the ability to implement it rather than to create it originally.” Freedom to fail is what enabled 3M to invent post-it notes and Google to develop new products through Google Labs. Finally, trust needs to be a core business value; “The lesson to be learned from IBM is that trust demands courage; the courage to let go, the courage to trust others, and, more than anything, the courage to jump the knowing-doing gap.”

Education

“[Innovators cited in the book] believe in education as a force for social equality – Marc Lewis sees his school as a catalyst for diversity and equality in the communications industry (a notoriously white, male, middle-class occupation). They believe in values-driven learning – Larry Rosenstock is fond of quoting Thomas Jefferson, ‘The purpose of public education isn’t to serve the public; the purpose of public education is to create a public.’ And they see it as a duty to ensure that the ideas behind their successes don’t remain in the petri dish, but spread virally throughout the system – witness Anne Knock’s sense of responsibility to educators across Australia. They all see themselves as part of a social movement to redefine education, not simply to lead it in their own schools.”

I recommend this book and would see it as a good one to keep a couple of extra copies, so you can give them away to those on the other side of the Open adoption chasm.

Tacit Knowledge Not Included

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It’s rather interesting to hear from the same company that 1) their situation is unique, and 2) they are looking for examples of best practices in their industry. If they are so darned unique, why aren’t they developing their own emergent practices?

When working with large organizations I frequently hear that their main business strategy is to be fast followers. This means looking for examples of best practices and applying them after they have been proven. You might even think this practice makes sense in industries like banking, where change could be rather risky.

The big problem with trying to be a fast follower is this: tacit knowledge.

Tacit knowledge is stuff that we know, but we can’t explain how to do it.  Think of it this way: have someone throw something at you, and try to catch it.  Now, describe exactly how you figured out where to put your hand to catch the flying car keys (or whatever).  You can’t.  There are calculations of speed, and trajectories, and muscle movements, and all of that goes on inside your brain and you can’t explain any of it.  That’s tacit knowledge. – Tim Kastelle

The major problem with any best practice is that it was proven to work for someone else. All best practice case studies should have a warning label attached: Tacit Knowledge Not Included. Tacit knowledge is one of the few things that cannot be copied, and what makes creative, non-standardized work so valuable. Tacit knowledge cannot be automated or outsourced. There are no best practices for tacit knowledge because it cannot be codified. Best practices can only help with lower value, routine work. They can help refine your existing business processes, but they are not a source of innovation.

tacit knowledge business valueAs Tim Kastelle says, “You build up tacit knowledge when you learn by doing.” That is why I keep saying that work is learning and learning is the work. Tacit knowledge is a source of core business value. It can only be developed through experience. Companies need to focus on learning from the work experiences throughout the enterprise, find ways to share tacit knowledge, and then make some of that knowledge explicit. But the real value is the stuff that cannot be measured, which requires a much different way of thinking about business value.

All human systems are complex and today most economic value is intangible, so that the most important knowledge for any organization is tacit.

In this world, workplace learning should be guided by a 70:20:10 approach, all workers should be empowered to actively practice PKM, and companies should promote knowledge-sharing & collaboration.

Connected leadership is not the status quo

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What is connected leadership? It’s not the status quo. Stephen Downes provides a succinct counterpoint to certain popular leadership literature, especially ‘great man’ theories.

‘Leadership’ is the trait people who have been successful ascribe as the reason for their success.
It is one of those properties that appears to be empirically unverifiable and is probably fictional.

As organizations, markets, and society become networked, complexity in all human endeavors increases. There are more variables as a result of more connections. In complex adaptive systems, the relationship between cause and effect can only be known after the fact. This makes traditional planning and control obsolete. Connected organizations must learn how to deal with ambiguity and complexity. Those in positions of leadership have to find ways to nurture creativity and critical thinking. The connected workplace is all about understanding networks, modelling networked learning, and strengthening networks. In networks, anyone can show leadership, not just those appointed by management.

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Only people can let knowledge flow

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The knowledge sharing paradox is that while sharing our knowledge is good for the organization, each individual has to see a personal benefit as well. The more the enterprise directs knowledge-sharing, the less likely it will happen. Conversely, the less structured the process, the more difficult it is for the organization to benefit. Damned if you do, damned if you don’t, or so it seems. Helen Blunden neatly sums up what can happen to those who freely share their knowledge.

I felt that my network, my trusted network which I worked hard to maintain, cultivate, nurture, trust and grow was going to be exploited by other individuals within the organisation who saw me as their ‘free ride’ to some quick answers.

Aye, there’s the rub; as Helen goes on:

My key learning point always goes back to looking at the culture of the organisation.  If there is a genuine, authentic opportunity to share and learn and be respectful of each other’s networks then I have no problem with it at all.  If it is mandated, or if my networks are used, misused or discounted, then I’d question why I’m even working there.

Knowledge flows when individuals actively engage in teams, communities, and networks by working and learning out loud. Both cooperative and collaborative behaviours, depending on the situation, are required. However, most organizations only focus on collaboration and fixed goals. Management often views cooperation as an aimless waste of time, which it can be. But collaboration and too much focus on teamwork can be detrimental to the organization as well.

knowledge flowsCommunities of practice can connect the knowledge flows between those messy social networks and focused work. This is where PKM (personal knowledge mastery) and PLN (personal learning networks) appear to differ. One aim of PKM is to connect learning and work. Steve Wheeler sees communities of practice as separate from the PLN, which he describes as mostly in the informal and opportunity-driven social network space.

One of the key differences I see between the two is that in PLNs, connections can be fairly random and interactions largely informal. Often there is a common ground such as a mutual interest or shared concern, but generally those who make up my PLN are a fairly ad hoc group of friends, colleagues, family and also those who have casually connected with me either through my instigation or theirs. In CoPs, connections are generally more deliberate, focused upon practice, often of a professional nature, and the interactions are focused largely upon the shared business of that community of practice.

PKM is focused on individuals who must negotiate and transcend the artificial barriers between their teams, communities of practice, and networks. Inside that person’s head, there are no knowledge barriers. However, discerning with whom and when to share, remains a key part of effective PKM. Social learning requires social intelligence, but organizations have to establish ways to support the multifaceted knowledge worker, or continue to face the knowledge sharing paradox. Understanding that people, not management systems, enable knowledge flow would be a good start.

connecting with PKM

Leveraging visualization

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Stowe Boyd and I had an email conversation a few weeks ago, which is now posted on his Socialogy site:

[Stowe] The thesis of Socialogy is that scientific findings about sociality, social networks, and human cognition are only slowly becoming part of management thinking, and as a result, much of what goes on as established practice in business is actually folklore dressed up as policy. Where do you see the greatest point of leverage in the application of scientific understanding of social connection in business?

…

[Harold] Cognitive science, anthropology, bioeconomics and other sciences may be the long lever, but visualization [with tools like social network analysis] is the fulcrum to widespread understanding of social connection in business.

As any marketing professional knows, ideas don’t spread themselves, they need to be in a form that first gets the recipient’s attention. Dan Pink talks about this with his six  types of sales pitches, giving the same message in different ways. I have found that the visualization that social network analysis provides can be very powerful, and network thinking can fundamentally change our view of social connection in business. Seeing is believing. Visualizing network relationships can give the initial leverage of getting complex new ideas accepted into general management thinking.

leverageFor example, I once used value network analysis to help a steering group see their internal community of practice in a new light. For the first time, they saw it mapped as a value network, not a hierarchy. They immediately realized that they were pushing solutions instead of listening to their community. This was obvious when all arrows pointed toward the user community, but no tangible or intangible value arrows pointed out. As a result, they decided to change their Charter and develop more network-centric practices. Thinking in terms of networks enabled them to see with new eyes.

HJ-network-map

Map of my LinkedIn connections, by LinkedIn Labs

Rebels on the edges

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At the end of the nineteenth century, mechanization changed the economy, the workforce, and society. Many countries, especially the United States and Great Britain, shifted from an agricultural to an industrial economy. Human muscle was replaced by machines. Farm workers left their fields and migrated to the factories.

Today we are a witnessing a similar shift, as human information processing is being drastically surpassed by integrated technology systems. This has been called the second economy. I frequently discuss the implications of work automation on what is becoming a post-job economy. Consider that about 35% of existing jobs have a 85% or greater chance of being automated. The challenge we face is how to distribute wealth when capital accrues to the few and there is no need to hire as much labour to run that capital. Industrial powerhouse General Motors still employs over 200,000 people, but who knows how long that will last. In comparison, computer hardware maker, and iTunes master, Apple has about 80,000 employees, while the search/advertising giant Google has 46,000. It seems that the more intangible the goods and services, the fewer people are required.

I mentioned the creative economy in a recent post and given the growth of this second economy, and fewer jobs produced in the current economy, we need to seriously reconsider how value, wealth, and economic independence can be achieved. The key is creativity. “Identifying the new” will be a critical skill. The creative economy will be led by people testing the limits of all fields of endeavour. This will be fueled by big (and distributed) data, in conjunction with networked people. Innovation will be so essential that it may no longer be discussed. Innovation and creativity will be the new literacies.

This is scary because most of our schools and other institutions do not foster innovation and creativity. I think many people will be left on the sidelines of the creative economy until we develop support systems that can help people tap their innate abilities that were ignored for much of the past century. Machines have already replaced most physical labour. Networked computer systems will continue to rapidly replace human thinking for logical and analytical processes.What is left is creativity. The demand for innovative ideas (like new business models) and creative ideas (like games and movies) is probably infinite. However, at this time, the supply is still limited. Platforms that can leverage collective creativity may be a way to get people into the new economy. Some existing organizations, like corporations or universities, could help, but they must significantly restructure.

Céline Schillinger, says that companies must cultivate their rebels in order to remain relevant to their workers, while staying competitive in their arenas. These rebels can let them see beyond the organization’s walls. Rebellious people are essential for a new economy that no longer requires the diligence and obedience now provided by networked computers. The rebel spirit is the competitive advantage for innovation and creativity. Most organizations do everything possible to extinguish it, but rebels can help cycle more quickly through increasingly shorter stages of competitive advantage. The new economy’s equivalent of the industrial assembly line will likely be some system that celebrates rebels. This will be an epochal shift in management thinking.

Rawn Shah once told me that knowledge is evolving faster than can be codified in formal systems and is depreciating in value over time. This pretty well sums up the situation. Humans have the ability to deal with some very complex things, yet too often our societal and organizational barriers block us from using our abilities. In the new economy, it’s not what you know, but what you do with what you can learn, that will be valued. It will take rebels on the edges to do this.

“I want to stand as close to the edge as I can without going over; on the edge you find things you can’t see from the center.” – Kurt Vonnegut.

edges_gapingvoidImage: GapingVoid.com