Tuesday, May 17, 2011

On reward mechanisms

For the last week I've been thinking about how we should deal with contributions from different members to the products we develop, and in general about how we should deal with open hardware and software communities.

If someone designs an electronic board to be used in one of our products and releases the blueprints (SENSORICA creates creative commons), there needs to be a mechanism to reward this contribution. All members of SENSORICA who market products developed within our community MUST respect everyone else's contribution. Assessing the value one adds to a product is one thing, making sure that contributions are rewarded is another. We need to write an agreement that every member must sign. It is an engagement to comply with SENSORICA's most basic principles.

This document is a contract between all members. In a sense it is legally binding, although enforcing it at the global scale becomes a real issue. I put my trust in our reputation system (we are implementing it), which must be capable of deterring parasitic behavior. As SENSORICA becomes a stable source of revenue for its contributers, it becomes suicidal not to comply with these principles. A tarnished reputation will go a long way... The world is turning into a village, word get's around fast, and persists.

As a first step, we'll go through an exercise of evaluation of everyone's contribution and carve that on a stone somewhere. This is in essence a negotiation process, a subjective process of evaluation followed by a consensus on the % of total value that every contribution represents. I'll set up some experimental tools to facilitate this process. See the Value Exchange Mechanism and the Back Office Catalog documents for inspiration.

Let's move now to open communities. To reduce costs and to insure continuity for our customers we'll incorporate open software and open hardware as much as we can into our products. SENSORICA could, in principle, tap into these pools of value at no cost. We could integrate open source software into our products, and even charge extra for it. But this is NOT ethical. And if you think ethics should not be part of business thinking, think twice... Ethics is actually becoming a must in the global, interconnected, and democratized economy. Not being ethical will make you lose market as well as your ability to tap into the wisdom and the intelligence of the crowd. Open innovation is extremely sensitive to ethics. If we want to tap into this unlimited source, we absolutely need to embrace the highest ethical standards. I proposed to our group to set up a fund for open communities. For every product sold, we should set aside a % of the revenue, which we will inject back into these communities.

If we get individual attention from some members of these communities, if some open source piece of software or hardware is customized by someone for SENSORICA, this individual becomes a member of SENSORICA and will be rewarded as mentioned above. But because we build on value already created by this open community, a % of revenues should go back to it.

How is the fund going to be redistributed back within these communities? I don't know... But I am sure we'll find a way to do it when we'll get there, a way which will not interfere with the gift economy operating within, a way which will not destroy these wonderful ecosystems.

What do you think?

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