Wednesday, April 27, 2011

SENSORICA road map

The role of this document is to lay out a long-term vision for SENSORICA, which will guide our strategies and help focus our activities.

It makes explicit an incremental development, avoiding some of the pitfalls laying ahead of us. 

We believe that this vision is coherent with our resources and competences (academia, optics, physiology, 3D design, biochemistry), with the market needs (low price, easy to use/customizable/versatile), and with the threats of competition (niche, rapidly expanding family of products, low-cost structure of developing/manufacturing/distribution). 

Sunday, April 24, 2011

Restructuring

Back to the open vs closed issue…

I wrote a few posts in the past where I presented a problem that many of you trying to build an open enterprise may face. There is a broad spectrum of views on the new economy, and that is because we don’t have a well-established theory yet. This is normal in times of transition, of paradigm shift. We are going through a period of wide experimentation, during which many models are proposed and tried. When you form a group/community around a project you may include in it individuals with different views, from the classical to the most radical, to the gift economy and cash-less society. How are you going to set the degree of openness of your organization in a democratic manner, in this context?

This is a very important issue, because it is directly related to the perceived rate of success of the venture. This is a very divisive issue!

In our case, some of the original members of Sensorica were not at all initiated to the new economy. They thought that the best way to bring our high tech sensor to the market is by creating a corporation, which is what I call a box. My views on the open enterprise are concentrated in the Discovery Network model. My first strategy was to educate. That failed, because without concrete examples of success my partners did not want to spend their time reading about open innovation. My second attempt was to infuse the organization with new blood, taking in open-minded members, and showing the power of open collaboration. The activity level went up, new ideas started to pour in, and some hardliners started to see the advantage of opening up. But at some point they started to feel insecure again. They felt that the risk of betrayal was growing, and feared that some of these new members could still our knowledge and jump over us to the market.

I have to admit that we haven’t reached the critical mass yet, and reputation mechanisms are still not fully engaged to stabilize our relations. In a sense my partners’ insecurity was justified. I tried to appease their feelings by explaining that know how is the most important asset in the new economy, NOT knowledge; but that didn’t work either.

Finally, one member proposed a wonderful compromise.

In a few words, we decided to create a separate company, a box, called Hyperion Inc., which will take under it the Mosquito sensor and everything that comes with it. 3 members went under Hyperion. Sensorica WILL REMAIN an open and decentralized value network, composed of individuals AND organizations (formally treated exactly the same). Hyperion will be a member of Sensorica. I formally dissociated myself from Hyperion, to become an individual member of Sensorica.

Hyperion will be a fully independent and autonomous entity, as any other member of Sensorica, BUT it will commit to act as an important contributor to Sensorica. Hyperion will need my input for further developing and improving the Mosquito sensor, which is definitely going under Hyperion, and I will need Hyperion to be part of Sensorica, to allow me to develop this collaborative environment. I will act as a consultant for Hyperion ONLY for matters regarding the Mosquito sensor (I am a co-inventor), which is not in contradiction with the open value network concept. Members can exchange freely among themselves within this collaborative space, as long as we respect the one member one vote rule for democratic decision-making. Hyperion has only one vote like any other member (see more on decision-making). For all new projects I will act as Hyperion’s collaborator within the Sensorica open and decentralized space, like any other member of Sensorica.

We have created a membrane around a few founding members to provide them with a more secure space in which they will be able to operate and to fully express their skills. Moreover, Hyperion will be able to get some funding as a classical entity, which will in turn have an impact of the development of the whole Sensorica community.

The only difference is that, at this moment, Hyperion doesn't want to share the knowledge around the Mosquito sensor with everybody else in Sensorica. That is the only thing! But in the near future other companies will become members of Sensorica, and we cannot force anyone to open up entirely. In my view, Sensorica is a collaborative environment that will put A LOT of pressure on members to open up. You cannot benefit from collaboration without opening up, to some degree, to everyone in that space. Knowledge has to circulate in all directions for happy things to happen! This is the trick my friends, right there! Environments like Sensorica are like melting pots where hard shell corporations melt down and blend with everything else in there. They get infected with the collaboration virus and get cured from competitiveness, because of purely economical reasons. The new technology creates an economical environment that benefits social beings; it's all about exchanging, socializing, coordinating, and collaborating at the global scale. In my view, this is the essence of the new economy.

Having said that, Sensorica should NOT have a strict policy on total openness. Members can keep their secrets. If WE are good enough, we'll create an environment in which it does NOT make economical sense to keep too many secrets. If we can't incite to openness we can't force it. That's my motto. The new economy comes naturally. The world is changing in a natural direction. We just need to follow it, like going down a river.

This restructuring solves two major problems at once. It creates a secure space within Sensorica for members who are not too keen on the new economy, and it provides us with a way to plug ourselves into the present-old economy, to suck in seed funding for our new projects through classical means.

So how open Sensorica should be? That still remains an open question. It's a process... But by putting in place this membrane around Hyperion we are now in a better position to reach a compromise. I think the level of openness will adjust itself in time, based on how every member will perceive the benefits of open collaboration, once value created starts to be exchanged on the market. We already have a first customer in sight!  

Friday, April 15, 2011

The legal form of SENSORICA - what are your thoughts?

The legal form is not an easy question...

Sensorica, our open enterprise, can be understood as an infrastructure of communication, coordination and collaboration, as a tool, NOT as a legal entity. We can also talk about the Sensorica group, which is a decentralized, value-based collaborative network of individuals, private organizations and academic organizations.

Members of Sensorica ARE legal entities and tax payers.

This is important in order to allow Sensorica to spread across the globe, to be fluid, and also to allow it to interface with other similar networks (communities like open source software, open manufacturing and 3D printing), which, as we are starting to understand, are very important for Sensorica to reduce the costs of our products and to insure continuity for our clients, etc.

What is important for a venture is to grow its market value, not how that value grows. We have the technology to take input from a wide base of contributors, to filter it, and to add it up coherently. Even if the input is very small, worth one hour of work, we still want it, because thousands of people are willing to give us that, and we want it all. The classical model takes in only large portions of value from a limited number of individuals, which are supposed to produce at their maximum capacity. With the new model we want to cast the net wide, to collect as much as we can. This is why Wikipedia surpassed in volume Britanica in only a few years! This model has already been demonstrated to be viable. We cannot do that if we treat every member as an employee. Members, by the hundreds, need to be able to freely come in and out of the organization, adding value to the product a bit at the time.

The internal structure of the group must be maintained flexible. Sub-groups must form dynamically around projects and they can dissolve once the work is completed, to be recycled into other soub-groups within the larger network. Because there is no formal status within the organization, this reshuffling can take place spontaneously. The internal bureaucracy must be greatly diminished.

How is the compensation handled? An independent entity takes care of billing the customer on the market side, and of distributing the income to every member in proportion to their respective contributions. Members declare their revenue in the country of their residence. The independent entity is not part of Sensorica, it only offers a service to the members of Sensorica group. We can create a non-profit to fulfill that role. If Sensorica would be a legal classical form it would be harder to solve the income tax problem, and the logistics for paying contributors distributed all over the planet will become more complex.

This independent entity can be understood as a value accounting organization. Every concrete contribution to the value of the enterprise is registered/recorded and evaluated. When products are exchanged on the market their value is actualized. The revenues generated from that exchange is redistributed to members according to a specific and explicit value sharing scheme. We could also consider an open alternative currency being used within the network, used to exchange value among members. The independent value accounting organization manages the internal flow of value.  

Individuals can incorporate themselves. Corporations can become members of Sensorica network, as any other form of organization.

Can this be implemented? I believe that our technology today, all these tools of communication, coordination and automated logistics, allows such loose and flexible structures to maintain their coherence. The key concept is self-organization, set in motion by a powerful sent of incentives, which can be created by communicating effectively and in real time the sources of value (rewords) and the system of flow of value, in and within the group.

If we want to harvest the planet this is, in my opinion, the only way around. Otherwise we go back to large chunks of value contributions from a limited number of individuals, concentrated mostly locally, and we miss the technological revolution boat.

We need legal agreements between members of some sort, firstly to grantee to contributors that they WILL BE paid (that’s where the main insensitives are) and secondly, to secure our tangible assets. Members will have to disclose their full identity.

Products would be produced and handled by member organizations, by licensed manufacturers, which can take any legal form. They would take responsibility for quality and guaranty. These manufacturers would not be partners of Sensorica, they would be PART OF Sensorica.

Thursday, April 14, 2011

We are making progress!

We let one week go by after the meeting reported in the last post (March 24) to calm our spirits. The conflicts that arose over the legal form of SENSORICA (our enterprise) left a scar on all of us, which is felt even today.

When I considered that the time was right, I started to expand our organization by bringing in fresh blood from different open spaces. My intention was to show my two remaining partners the value of being open. Our Mosquito sensor prototype, which represents a value in it self, promising revenues down the road, our promise to fairly compensate contributions, and the empowerment that emanates from the open enterprise resonated immediately with a few talented and free minded individuals.

I made my first call within an Open Manufacturing space. Lee, a computer engineering graduate student from Texas answered almost immediately. He brought in a new dimension to SENSORICA, 3D printing for fast prototyping and as part of our manufacturing strategy. Everyone realized that the costs of our products could be reduced dramatically by allowing the customer to produce some parts locally, from our digital blueprints, giving us a better chance to compete with the big manufacturing players within the emerging markets. We also realized the possibility to involve members of the Open Manufacturing community in the design process.

I also caught the attention of Daniel, my brother, which was not as easy as you might think, for product design and 3D modeling. Daniel and I are pretty well aligned on the open philosophy, which will be helpful in the long run.

Dominic, a very experienced guy from Chicago, a product designer and a connector, with experience in medical devices also contacted me shortly after. He repeatedly expressed his appreciation for our open model and he stressed the relevance of open initiatives within the actual economical context, considering the high unemployment rates.

Recently I met Alex, a very articulate guy from L.A. developing a network for design, prototyping and manufacturing of open source scientific instruments.

Bayle from San Diego and his PieTrust group, developing a platform for reputation, contribution management, evaluation and value exchange, which I consider an essential service service for the open enterprise, is also gravitating around SENSORICA.  

Last Friday we had another general meeting with the new members which went very well. In my view, this meeting was the most productive one we ever had, showing one important advantage of being open, the ability to rapidly assemble a team of experts and to leap frog towards success, with no expenses, only based on a promise of future compensations and on a guarantee of equal rights within the enterprise.