Esko Kilpi on Interactive Value Creation

The art of interaction, the design of digital and the science of social complexity

Tag: Creative learning

A pattern language of post-industrial work

At the core of the post-industrial era is the idea that people should design for themselves. This principle applies also our value creating entities. This may sound radical but comes from the observation that most of the value on global scale is not created by firms but by people. People, then, should learn to be better designers. When designing something we always rely on certain patterns. We are in the midst of a shift from the industrial pattern of supply and demand to social, interactive patterns.

The customer is now seen as being directly and actively involved in the key moments of value creation as opposed to passively consuming value. There are profound implications that result from this change of thinking. Products and services are not reproducible as such any more. Solutions are by default contextual, but they can be starting points for someone else to create value. Creative, connected learning is at the core of the post-industrial business.

The most important principle is to build the organization around three design patterns: (1) Relations, (2) Network effects and (3) Solving problems /Asking questions.

Relations

Cultural homogenization is a theme of our time. It is apparent in fashion, food, music, and many services with a unified user experience. Everything is made to be basically the same everywhere. According to some psychologists, the desire for this sameness arises from anxiety about differences. This is one of the reasons why Gregory Bateson argued that the history of our time can be perceived as the history of malfunctioning relationships. More homogenization leads to more anxiety (when experiencing differences) which leads to more homogenization and the “differences that make a difference”, as Bateson put it, are lost.

Human behavior is learned in relations. Our brains are wired to notice and imitate others. Computational social science has proved that behavior can be caught like a disease merely by being exposed to other people. Learning and also non-learning can be found in communication. It is not that people are intelligent and then socially aware. Social intelligence is not a separate type of intelligence. All intelligence emerges from the efforts of the community.

To succeed you need relationships and interaction. When customers are identified as individuals in different use contexts, the sales process is really a joint process of solving problems. You and your customer necessarily then become cooperators. You are together trying to solve the customer’s problem in a way that both satisfies the customer and ensures a profit for you.

The industrial make-and-sell model required expert skills. The decisive thing was your individual knowledge. Today you work more from your network than your skills. The decisive thing is your relations. The new structures and new designs are about communities continuously organizing themselves around shared contexts, meaning shared interests and shared practices. The focus of industrial management was on the division of labor and the design of vertical/horizontal communication channels. The focus should now be on cooperation and emergent interaction based on transparency, interdependence and responsiveness.

The really big objective of the digital transformation is to reconfigure agency in a way that brings relationships into the center. Success today is increasingly a result of skillful participation: it is about how we are present and how we communicate. Through new technologies, applications and ubiquitous connectivity, we have totally new opportunities for participation and communication — potentially changing the way we work together.

Network effects

The new platforms can be a valuable, shared resource making value creation possible through organizing and simplifying participation. Sociologists have called such shared resources public goods. A private good is one that the owners can exclude others from using. Private was valuable and public without much value during the era of scarcity economics. This is now changing in a dramatic way, creating the intellectual confusion we are in the midst of today. The physical commons were, and still often are, over-exploited but the new commons follow a different logic. The more they are used, the more valuable they are for each participant.

The ongoing vogue of business design transforms asset-based firms to network-based platforms. The effects of Moore’s law on the growth of the ICT industry and computing are well known. A lesser-known but potentially more weighty law is starting to replace Moore’s law in strategic influence. Metcalfe’s law is named after Bob Metcalfe, the inventor of the Ethernet. The law states that the cost of a network expands linearly with increases in the size of the network, but the value of the network increases exponentially. When this is combined with Moore’s law, we are in a world where at the same time as the value of the network goes up with its size the average costs of technology are falling. This is one of the most important business drivers today.

The implication is that there is an ever-widening gap between network-economy companies and those driven by traditional asset leverage models. The industrial economy was based on supply-side economies of scale inside the corporation. The new focus is outside, in demand-side network economies.

The most important model is a network structure where the value of all interactions is raised by all interactions; where every interaction benefits from the total number of interactions. These are the new network businesses. In practice this means that digital services can attain the level of customer reach and network size, required to capture almost any market, even as the size of the company stays relatively small. This is why network-economy based start-ups have such a huge advantage over asset leverage based incumbents. The key understanding is that it is now the customers or members of the network who create value, not the network owner. The customer will be transformed from being an audience to an actor.

The central aggregator of enterprise value will no longer be a value chain. The Internet is a viable model for making sense of the value creating constellations of tomorrow. Perhaps the next evolutionary step in the life of the firms is a transformation from platforms to open commons with shared protocols. Perhaps Bitcoin/Blockchain is going to be part of the new stack, the TCP/IP of business.

Solving problems /Asking questions

Success in life has been seen governed by two concepts: skills and effort; how bright you are and how hard you work. Recently, researchers have claimed that there is a third and decisive concept. It is the practice of lifelong curiosity: “knowing what to do when you don’t know what to do” as Piaget put it.

The collective intelligence of our societies depends on the tools that augment human intelligence. We should welcome the fact that people today are smarter in large measure because they have invented and use smarter tools. Making tools is what human beings have always done. The interactions between tools and human minds are so complex that it is very hard to try to draw a line between humans and technology. Neither is it a zero-sum game where the human brain is losing to technological intelligence, but as technology changes, people and what people do, are necessarily changed.

Work starts from problems and learning starts from questions. Work is creating value and learning is creating knowledge. Both work and learning require the same things: interaction and engagement. With the help of modern tools, we can create ways for very large numbers of people to become learners. But learning itself has changed, it is not first acquiring skills and then utilizing those skills at work. Post-industrial work is learning. It is figuring out how to solve a particular problem and then scaling up the solution in a reflective and iterative way — both with technology and with other people.

The new design patterns create new opportunities. It is not about having a fixed job role as an employee or having tasks given to you as a contractor. The most inspiring and energizing future of work may be in solving problems and spotting opportunities in creative interaction with your customers.

From the industrial economy to the interactive economy

Over the past years, mobile technologies and the Internet have laid the foundation for a very small size, low-cost enterprise with the potential for managing large numbers of business relationships.

The impact of these new actors has been hard to grasp because we are used to thinking about work from a different perspective. Our thinking arises from a make-and-sell economic model. Most managers still subscribe to this and think that the core of creating value is to plan and manage a supply chain. A supply chain is a system of assets and transactions that in the end make the components of the customer offering. At the beginning of the supply chain are the raw materials and the ideas that start the sequence leading, hopefully, to a sale.

This is now being supplanted by a different paradigm; a relational, network approach enabled by new coordination technologies. The manufacturer may even be just one of the nodes in the network and the customer is not a passive consumer but an active part of the plan.

The old model companies are ill equipped for this digital transformation. Mass-production and mass media organizations are still much more prepared to talk to customers than to hear from them, not realizing that one-way communication was just a fleeting accident of technological development. It is not that customers didn’t have needs and reflections they would have liked to communicate.

We are passing through a technological discontinuity of huge proportions. The rules of competition may even be rewritten for the interactive age. The new interactive economy demands new skills: managing the supply-chain is less important than building networks and enabling trust in relations. You could perhaps call the new reversed sequence an on-demand-chain. It is the opposite of the make-and-sell model. It is a chain of relationships and links that starts from interaction with the customer and leads up to the creation of the on-demand offering. As Steve Jobs put it in a different context: “you start with the customer experience and work backwards to the technology. You can’t start with the technology and try to figure out where you’re going to try to sell it.”

Adapting the interactive model is not as easy as identifying customer segments or a niche market because communication can no longer be confined to sales and marketing, or to the ad agency, as in the make-and-sell model. Also to talk about a “segment of one” is misleading because one-way communication changes here to true two-way dialogue. The interactive enterprise must be able to integrate its entire network around the needs of each individual customer context. The on-demand-chain means continuous on-demand learning and continuous change. Your dialogue with an individual customer will change your behavior toward her and change that customer’s behavior toward you. People develop together in interaction.

A learning relationship potentially makes the whole network smarter with every individual interaction creating network effects. Accordingly, the enterprise increases customer retention by making loyalty more convenient than non-loyalty as a result of learning. The goal is to create more value for the customer and to lower her transaction costs. This kind of relationship ensures that it is always in the customer’s self-interest to remain with the people who have developed the relationship to begin with. The main benefit for the network partners may not be financial. The most valuable thing is to have access to “community knowledge”, a common movement of thought. It means to be part of a network where learning takes place faster than somewhere else.

In the mass-market economy, the focus was to create a quality product. With increased global competition and with so many quality products around that is not enough any more. To succeed you need high-quality relationships. When customers are identified as individuals in different use contexts, the marketing process is really a joint process of solving problems. You and your customer necessarily then become cooperators. You are together trying to solve the customer’s problem in a way that both satisfies the customer and ensures a profit for you.

The relational approach is the third way to work. It is not about having a fixed job role as an employee or having tasks given to you as a contractor. The most inspiring and energizing future of work may be in solving problems and spotting opportunities in creative interaction with your customers.

The industrial make-and-sell model required expert skills. The decisive thing was your individual knowledge. Today you work more from your network than your skills. The decisive thing is your relations.

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Work in the Machine Age  –  Humans Need to Apply

The oft-quoted proof of the rise of machines making human work obsolete is games in which humans lose to computers. This happened in checkers in 1994. It happened in chess 1997. Now computers match humans in Scrabble, backgammon, poker, and even Jeopardy. There is still one exception, “Go”. Why is that? What is so special about Go? The game is similar to Chess in many ways, it is a “deterministic, perfect information game”, meaning a game where no information is hidden from either player, and there are no built-in elements of chance, such as throwing a die. But there are some interesting differences.

For the first move in chess, the player has twenty choices. In typical chess positions there will be around 30-plus possible moves. A typical game lasts about 40 moves before the resignation of one party.

Go players begin with a choice of 55 possible moves. This number rises quickly and soon almost all of the 361 points of the board must be evaluated. Some are much more popular than others, some are almost never played, but all are possible. That makes for 129,960 possible board positions after just the first round of moves. A typical game of Go lasts about 200 moves. As a game of chess progresses, as well as in many other games such as checkers, pieces disappear from the board, simplifying the game. Go begins with an empty board. Each new Go move adds new complexities and possibilities to the situation. The key here is the number of choices available.

The more choices there are, the harder it gets for computers.

The industrial logic was most vividly captured in the idea of the value chain. Value-creating activities were sequential, unidirectional and linear. Those performing the following task must comply with the constraints imposed by the execution of the preceding task. The reverse cannot normally take place. The architecture consists of tightly coupled tasks and predetermined, repeating activities. The output of one task was the input of another. If-this-then-that. Work was algorithmic.

Workers in industrial-age firms were used to the rules that limited choices. The burden of decision making, with the consequent need to communicate and gather costly information, was minimized. Furthermore, by narrowing the scope of choices, the learning requirements for workers were limited. In part, the efficiency-enhancing contribution of mass-production was derived from these lower learning costs.

Work has been designed as a very, very simple game.

Is it then fair to draw the conclusion that the microchip may well replace the human race? Or have we just designed human work plain wrong? Could we, and should we, change the rules of our game?

The most important reason why we need a new concept of work/games is because the players and their contributions in the real world are, at best, too diverse to rank. They are, and should be, too qualitatively different to compare quantitatively as labor. Unlike mechanical systems, human systems thrive on variety and diversity. An exact replication of behavior in nature would be disastrous and seen as neurotic in social life.

The problem we face today is not in the capabilities of humans but in the outdated and limiting conceptualization of work. Work as we know it is mainly designed for machines, not for human beings.

Human life is non-deterministic, full of uncertainty, unknowns and surprises. Creative learning is the fundamental process of socialization and being a human. For a human being, the number of choices or moves in the game of life, in any situation, is unlimited. This is the very hard to copy difference between men and machines.

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Men and machines

I took part in a meeting on technological intelligence and the future of work. One of the questions raised was: “If machines can replace people’s minds in knowledge work as effectively as machines replaced their muscles in manual work, what will ultimately be left for human beings to do? Are we going to run out of jobs?” My answer was that this concern is based on a totally incorrect assumption. Working life does not consist of a finite number of things to which the human mind and human effort can be applied.

The challenges that confront us every day are unlimited. Every solution to a problem generates several new problems and unforeseen opportunities. No matter how many are solved, there will always be an infinite number ahead of us. Although modern technology has reduced the number of things that in the past had to be dealt with by human beings, it increases the complexity of the challenges that require human attention now and in the future.

Technology: robotics, machine intelligence and cognitive computing do change what people should be doing and how organizations come to be what they are. This is why we need to revisit and rethink our conceptualizations of work.

When the Industrial Revolution began, the dominant Newtonian worldview meant that there were no significant uncertainties, or unknowns, messing things up. Physical laws described what things, following a linear, rational causality, would do. Most academic experiments were constructed accordingly, and still are today. The aim was often to study the effect of one known variable on another.

Business enterprises were consequently thought of as algorithmic processes, as machines. Enterprises conceptualized as machines, like all machines, didn’t have a will of their own. They served the intentions of their creator, the owner. Employees were, of course, known to be human beings, but their personal intentions were seen as irrelevant. People were retained as long as they were needed to fulfill the intentions of the creators.

The systemic and biological conceptualization then replaced the notion of an enterprise as a machine. One often overlooked reason for this was the changing structure of ownership. When a firm went public, its creator disappeared. Owners were seen as anonymous, and too numerous to be reachable. The Industrial Revolution turned into the Managerial Revolution we are still living through today.

The Managerial Revolution changed the thinking around the purpose of the firm. Like any biological entity, the enterprise now had fitness and longevity as raisons d’être of its very own. Profit came to be thought of as a means, not an end in itself. Success came to be measured by growth. It was seen as essential, just like in nature.

The systemic view was a profound change in thinking compared with the mechanistic view. A biological organism is not goal-oriented in the sense of serving external purposes or moving towards an external goal. The movement is toward a more fit or more mature form of itself in a particular environment. An organism can adapt, but cannot leave or choose to be something else.

But humans are creative and humans can choose and you never know what they will do next.

This is why things are changing again. The sciences of uncertainty and complexity have helped us to understand that organizations are patterns of interaction between human beings. These patterns emerge in the interplay of the intentions, choices and actions of absolutely all the parties involved. No one party can plan or control the interplay of these intentions. But even without being able to plan exact outcomes, or control what others do, people can accomplish great things together.

The thing is that people can only accomplish their work in the necessarily uncertain and ambiguous conditions through ongoing conversations with each other. Work is negotiation. This is why the next revolution is dawning.

The social revolution, the human-centric revolution, is about deeply rethinking the value of human effort. An increase in value can only occur if people can do something in interaction that they cannot do alone. Social business may be more about complementarity and coordination than collaboration.

An enterprise that is conceptualized as a social business, should (1) serve the purposes, the will, of all its constituents. It should (2) enable its parts to participate in the selection of both the ends and the means that are relevant to them personally. If the parts of a system are (3) treated as purposeful, they must (4) have the freedom to choose and to act, not independently, but interdependently. This is because the basic unit of work is (5) interaction between interdependent people.

This means that the defining characteristic of a social business is the increased, non-algorithmic, variety of behaviors that is available. It is not necessarily about common goals or shared purposes any more. It is a common movement of thought that always surprises us.

The way our organizations are conceptualized has a great effect on what people do, and what they do affects the way organizations are conceptualized. Enterprises have always consisted of people who have ideas, intentions and a will of their own. Now it really matters. All people can be creators. All people are creators!

This, in the end, is what makes people different from machines.

The two faces of digital transformation

Have you ever wondered why you don’t see anyone reading a book when you visit companies? We associate reading with finding information and learning, but we also include qualities such as contemplation, solitude and mental privacy when we think about books.

There is a mental framework that is used when dealing with books, and another distinct mental framework regarding information-related practices in the corporate world. Basically, you are not allowed to read a book, but you can read a document.

Documents and word processing are part of the framework of management today. Documents were born from the needs of a hierarchical, systemic approach to management. Top-down information was in the form of PowerPoint slide decks containing vision statements, Excel sheets with goals and Word documents explaining corporate procedures. Bottom-up information was used mainly to provide reports and data for managers, helping them to keep their employees accountable and to ensure the smooth operation of the business process.

Computerized word processing is associated with terms such as information flows and the sharing of information. This is not something you normally talk about when discussing a book. While a book provides a view of the contemplative mind, documents create a view of controlled content.

Are you still asking why you can read a document but you are not allowed to use Facebook?

Instead of predictive process flows, creative work follows a different logic. Work is about community-based cognitive presence. But cognition is just part of the answer. Work tomorrow will be even more about social presence. To work and to manage is to participate in live conversations. A dramatic shift is needed in the mental framework of information, communication and work. Without this changing mindset, no efficient digital transformations can be made in the corporate world. Work is communication. Conversations and narratives are the new documents.

The first face of digital transformation is about new ways to be present and new ways to communicate

You cannot design live interaction. Conversations cannot be controlled. The only way to influence conversations is to take part in them. You cannot plan in the traditional sense of specifying a structure or a process and then implementing it. As many have experienced, communities seldom grow beyond the group that initiated the conversation, because they fail to attract enough participants. Many business communities also fall apart soon after their launch because they don’t have the energy to sustain themselves.

Communities, unlike business units need to continuously invite the interaction that makes them alive.

Community design is closer to iterative, creative learning than to traditional organizational design. Live communities reflect and redesign themselves throughout their life cycle. This is why design should always start with very light structures and very few elements.

What is also different is that a good community architecture invites many kinds of participation. We used to think that we should encourage all the community members to participate equally. Now we know that a large number of the network members are, and should be, peripheral. In a traditional meeting we would consider this type of participation half-hearted, but in a network a large percentage of the members are always peripheral and rarely contribute. Because the boundaries of a live community are always fluid, even those on the outer edges can become involved for a time as the focus shifts to their area of particular interest.

Because conversations and communities need to be alive to create value, we need an approach to management that appreciates passion, relationships and voluntary participation. Rather than focusing on accountability, community design should concentrate on energizing, enriching participation.

The new structures and new designs are about communities continuously organizing themselves around shared contexts, meaning shared interests and shared practices. The focus of industrial management was on the division of labor and the design of vertical/horizontal communication channels. The focus should now be on cooperation and emergent interaction based on transparency, interdependence and responsiveness.

The really big objective of the social side of digital transformation is to reconfigure agency in a way that brings relationships into the center. Success today is increasingly a result of skilful participation: it is about how we are present and how we communicate. Through new technologies, applications and ubiquitous connectivity, we have totally new opportunities for participation and communication – potentially changing the way we work together.

The customer of the industrial age was seen as a recipient of value, or a consumer of value. Enterprises also viewed customers through the lens of a fairly uniform set of features, leading to customers being seen as having relatively uniform needs. But even commodity products are always a bundle of use contexts, buying patterns, complementary goods and delivery options. Just because a product is a commodity doesn’t mean that customers can’t be diverse in the ways they use the product. Different customers use products that are manufactured in the same way, with the same product features, differently. This is why customers are today understood to be active contributors to value creation. Without their part, the value of the product could not exist.

Companies used to have no mechanisms for connecting with the end users in order to understand and influence what was going on. Digital technologies are now changing this. When a customer teaches a firm what she wants or how she wants it, the customer and the firm are also cooperating on the sale of a product, changing the industrial approach to sales and marketing. The marketing and sales departments used to be the customer’s proxy, with the exclusive role of interpreting changing customer needs. Internet-based business necessarily transforms the marketing function and sales specialists by formally integrating the customer into every part of the organization. The customer of tomorrow will interact with, and should influence, every process.

As the goal is to create more value together, a critically important new element is embedded computing, the integrated intelligence that is attached to the “things”, the offerings, the products.

It is about creating new software code. It is about two new digital layers for all products: (1) an algorithmic layer, which can mean sensors or location and usage data allowing totally new kinds of data analytics and (2) a network layer.

As the customer’s need set is expanded beyond the pre-set features of the physical offering through software, the definition of the product changes and becomes more complex. The more complex the product, the more opportunities there are for the company to learn something that will later make a difference.

The value of the code may determine the value potential of a product more than the physical product itself. The effectiveness of an offering is related to how well it packages the learning from past activities and how it increases the users options for value creation. A product or a service should be pictured as a node in a network with links to other use cases, supplementary services and complementary features surrounding the product. The more relevant the links are considered to be, the richer the product will become. The task today is to visualize the product in the broadest sense possible.

The study of isolated parts offers little help in understanding how connected parts work in combination and what emerges as the result of network connections. What new relational technologies are making possible for manufacturing industries is a much, much richer repertoire of potential futures than what we were used to in a traditional industrial firm.

The ability to create value in a remarkably more efficient and resource-wise way corresponds to possibilities for interaction with other relevant parts and actors. If interdependent links are few, poor, or constraining, the activity and value potential will be limited.

Interestingly, the same principle applies both to things and to human beings!

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More: The product is the medium.

The Internet of Things

Industrial era enterprises viewed customers through the lens of a fairly uniform set of features, leading to customers being seen as having relatively uniform needs. But even commodity products are always a bundle of use contexts, buying patterns, complementary goods and delivery options. Just because a product is a commodity doesn’t mean that customers can’t be diverse in the ways they use the product.

All use cases are somewhat the same and somewhat different. This means that different customers and processes use products that are manufactured in the same way, with the same product features, differently. It is contextual. Customers and the way products are used, are today understood to be active contributors to value creation. The word “consumption” really means value creation, not value destruction. Companies don’t create value for customers, the way the products are used creates value, more value or less value.

The parties explicitly or implicitly “help each other to help each other”. Value creation is a process of interaction. As the goal is to create more value together, a critically important element would be to implant context aware intelligence and interaction capability to a product.

The Internet of Things refers to embedded computing power and networking capability of the physical objects through the use of sensors, microprocessors and software that can collect, actuate and transmit data about the products and their environment. The gathered data can then be analyzed to optimize, develop and design products, processes and customer services. IoT is often about two new digital “layers” for all products: (1) an algorithmic layer and (2) a network layer.

The algorithmic layer “teaches” the customer and the product itself to create more value in a context-aware way, and accordingly teaches the maker the product to develop. As a result, the customer’s need set is expanded beyond the pre-set physical features of the offering. This changes the conceptual definition of the product and it becomes more complex. The more complex the product, the more opportunities there are for the maker to learn something that will later make a difference.

From a marketing standpoint, when a customer teaches the firm behind the product how she uses the product, what she wants or how she wants it, the customer and the firm are also cooperating on the sale of a product, changing the industrial approach to sales and marketing. The marketing and sales departments used to be the customer’s proxy, with the exclusive role of interpreting changing customer needs. Internet-based business necessarily transforms the marketing function and sales specialists by formally integrating the customer use case into every part of the organization. Thus the customer of tomorrow interacts with, and should influence, every process of the maker through the connected, intelligent products.

In the age of the Internet of Things, all products are software products. The value of the code, computing power and connectivity, may determine the value potential of a product more than the physical product itself. The effectiveness of an offering is related to how well it packages the learning from past activities, other use cases and from other similar products and how it increases the users options for value creation through network connections in the present. The offering actuates data via algorithmic smartness and through live presence (in the Internet). Connectivity also enables some functions of the product to exist outside the physical product in the product system, the cloud.

A product or a service should today be pictured as a node in a network with links to supplementary services and complementary features surrounding the product. The task today is to visualize the product in the broadest sense possible.

Visualizing these connections changes the strategic opportunity space dramatically. The study of isolated parts offers little help in understanding how connected parts work in combination and what emerges as the result of network connections. Every link and relationship serves as a model for what might be possible in the future. What new relational technologies are making possible for manufacturing industries is a much, much richer repertoire of business opportunities than what we were used to in a traditional industrial firm.

The ability to create value in a remarkably more efficient and resource-wise way corresponds to possibilities for interaction with relevant actors, information and products. If interdependent links are few, poor, or constraining, the activity and value potential will be limited.

The Internet of Things and technological intelligence in general, create transformative opportunities for more efficient and more sustainable, resource-wise, practices and also higher margins!

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Thank you Rafael Ramirez

More on the subject: Ford’s OpenXC. Bosch. Kari A. Hintikka (In Finnish)

The importance of SLUSH

The creative era we live in is an age of unprecedented possibility compared with the industrial age. Totally new opportunities are systematically being created. One of the best examples of this is the SLUSH event that took place in Helsinki on November 13th and 14th. SLUSH is a two-day startup conference, a meeting point and a coming together of roughly 6000 people belonging to the international startup ecosystem. There are entrepreneurs, investors, startup founders, employees and students taking part.

The democratization of technology that is taking place at the moment does not determine social and organizational change, but does create new opportunity spaces for new social practices. Some things are becoming much easier than before and some things are becoming possible, perhaps for the first time. The vibrant startup culture proves this point.

There are very few isolated geniuses. But there are many bright people who have continued and improved the work of others. Capable people always have capable peers, people who act as filters connecting them with people and connecting them with high quality information. The goal of SLUSH is to “gather the connections that startups need to thrive on the global stage.”

In a sense, creative people are more remixers of other peoples’ ideas than inventors. Technology and development are not isolated acts by independent thinkers, but a complex storyline, where the storytellers and curators, are more important than the heroic inventors, if there ever were any.

Creative, connected learning is at the core of the startup business. SLUSH is a huge learning festival and the biggest concentration of positive energy I have seen in a long time. Businesses and non-profits like SLUSH, more than government, seem to be driving the changes in education that are required for the knowledge-based economy. The government-run education systems are lagging behind the transformation of learning that is evolving.

Learners are teachers and teachers are learners during the two hectic days of SLUSH. Creating learning connections is more valuable today than creating learning content. Information is becoming a process of continuous iteration and networked negotiation. Information networks are the architecture of work and a valuable, shared resource. These networks are the new commons. In the new commons people with many ties are better informed and have more signalling power, while those outside the commons and with few ties may be left behind.

The real forte of SLUSH is that as we engage in new relationships, we are creating new potentials for action. Every human relationship, every connection, serves as a model for what is possible. The Internet era has proven that we are capable of working together competitively/cooperatively and building social communities that some time ago many would have dismissed as impossible dreams.

Thus we don’t yet have a good idea of what cannot be done by connected people working together in new ways. Perhaps “We can walk on water” as @pvesterbacka from Rovio says in a very compelling way.

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Thank you Miki Kuusi, Ilkka Kivimäki, Peter Vesterbacka, Inka Mero and the whole team! And yes, Supercell! It was a great party!

More on commons.

What Supercell can teach us about the future of work

The new landscape of work is alien territory for most of today’s business leaders and business schools, but things are already moving towards a new world.

The new landscape consists of the network as the architecture of work and work as coordinated action between non-co-located but interdependent people. The astonishing thing is that we can find an existing, efficient, working model for this kind of digital work. It is games.

The game environment may be the next productivity suite available for digital work. Adopting the best qualities of games could help firms to meet the pressing challenge of highly mobile and distributed work.

What, then, can be learned from these games?

The pace of games is normally very fast and requires fast decision-making. Decisions are typically based on incomplete information and are always iterated as more data become available later. You can’t take a lengthy pause to strategize and to weigh up the options. The culture needs to embrace changing decisions, learning and adopting constant corrections to the course that was initially chosen.

Acting is always based on uncertainty. You can’t succeed in an uncertain environment without trial and error, without taking risks. You can’t embrace risk taking without accepting failures. Here the game environment is fundamentally different from most corporate cultures. Frequent risk taking and confronting risks routinely help players to learn to keep paradoxes alive calmly and to live efficiently with continuous change.

Management in games is often temporary. People switch roles. They direct others one minute and take orders the next. Management is a task. It is not a position, or part of the identity of an individual. Companies often identify people as leaders because of the high level of potential they show early in their careers. That model may not work in the future. The growing complexity of business means that no single leader can handle all the different challenges any more. Treating management as a temporary state and a task can be the new model of the future. The whole assumption that leadership resides within an individual may not be correct at all.

Getting the network environment right for cooperation is imperative. Efficient digital environments make information open to all of the players, all of the time. This information includes quantified-self type statistics and trend information for reflexive work. Real-time status updates on operations make planning the next move easy.

The mainstream corporate approach to knowledge management has assumed that thinking and doing are separated. In the game environment a player is expected to act on information, without waiting for instructions from a boss. The most interesting thing in the game environment is that it allows people to take responsibility, to assume leadership as and when needed.

The widespread adoption of game mechanics for coordination and taking responsibility would require a dramatic change in mainstream organizational culture. However, the games are here today and the generation that has grown up playing the games is growing up and joining corporations.

They are going to be the drivers of the change towards a more creative, productive and more fun work environment.

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The foundations of social business: pull communication

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In mainstream thinking, managers are understood as the prime originators of what happens in their businesses. The central concern is how the active manager/subject gets the passive follower/object to act in ways that reflect the manager’s perspective. Management continues to see communication in terms of influence and manipulation.

The social business view sees relations and communication as conversational processes of meaning making. It is a movement of thought on the basis of multiple perspectives that you invite or you pull. A person, when networking, would be subscribing to contextually relevant topics and people. Push transforms to pull.

Interaction starts with recognition. It is about granting attention to people and information and making room for them in our lives.  Leading and following in the traditional corporate sense have seen the leader making people follow him through motivation and rewards. The leader also decided who the followers should be.

When seen through the logic of social business and social tools, leading and following have a very different dynamic. Leading in this new business sense is not position-based, but recognition-based. People, the followers, decide who to follow and what topics to follow.  You pull information from someone you trust to be at the forefront in an area, which is temporarily meaningful for you.

Another huge difference from traditional management thinking is that because of the diversity of contexts people link to, there can never be just one source of information. Thus, an individual always has many topics and people that she follows. You might even claim that from the point of view taken here, it is highly problematic if a person only has one “leader”. It would mean attention blindness as a default state.

Pull communication is at best a process of active following, creative learning through observing and simulating desired practices. Leading on the other hand, is doing one’s work in a transparent, inspiring and reflective way.

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Thank you John Hagel, Stowe Boyd and Stephen Downes

More on the subject: Stowe Boyd.