Hierarchy vs decentralization

The culture of openness is not settled yet. I think it is not enough to look at these well-known open projects (often representing early successes like Linux and Wikipedia) to predict where we're heading. I personally see most of these first open projects as hybrid structures. It is hard to collaborate in a overly competitive culture. It is hard to be entirely open in a culture of secrecy and predominantly elitist. It is hard decentralize in a culture of control. I always like to say that it almost takes two brains to operate in the old paradigm and in the new. Two different paradigms! (Don't take the term paradigm lightly) I see organizations morphing towards openness and decentralization, towards distributed analysis, planning, and decision making.    

Decentralization doesn't mean flat, nor chaos. In my view, this term refers to governance and decision making, but NOT to value creation processes. I use hierarchy almost as the opposite of decentralization, referring to power relations. 

In SENSORICA we are trying to eliminate power relations (= instituted power over others - power to fire someone, to tell someone what to do and when to do it, or like in the army), to build a value-based organization (value as in economical value, not as in moral value). Using my terminology, SENSORICA would not be a hierarchy in this case. This is why we call it a decentralized value network. SENSORICA would be decentralized but it doesn't mean that there is no structure! The structure comes from voluntary subordination. It comes dynamically, this is why we call SENSORICA an open, decentralized, and self-organizing value network. So there is organizing, there are very well defined roles, there is an established flow of processes, but there is no power structure. Power relations are not operational within this value network. 

How tight can this organization be without power relations? I believe we can make it tight enough if all members have access to all the data, if members have access to analysis tools, if they can communicate and coordinate effectively, if some roles are well defined within the community, if other constraints like reputation and access to revenue are operational, if the incentives are clear, etc, etc. 

I think that power relations are fading away. They play a crucial role in a world deprived of efficient means for peer-to-peer communication and coordination. Power brings accountability, which is what enables information to travel unaltered through a geographically spread and numerous society, from person to person. Information is crucial for large social systems to sustain themselves. Hierarchy is an attractor in these conditions. The only way to form large societies in this context is to structure them hierarchically, with a center of analysis, planning, and command, relying on accurate information that propagates through trust and accountability (power = if you lie to me I kill you). 

The new technology changes everything! It enables peer-to-peer communication and coordination with no temporal and spatial barriers (at the scale of our planet). This constitutes a cataclysmic event in the history of humanity. Societies are now going through metamorphosis. Almost everywhere we look around we see decentralization going on. It's a slow and continuous process, we see a lot of intermediary structures, but the question is where is it going? 

As systems decentralize the world is NOT becoming a mess. It just gradually transitions from one form of organization to a different one, in which power relations play a smaller role. 

No boss doesn't mean that decisions are not taken! They are, in a distributed and even continuous (instead of discrete decisions) manner.  

Openness is necessarily part of this transition, because in order for the system to sustain itself information needs to be accessible to all members. 

More to come... 

How an open enterprise can service its customers

I am working on a service system for SENSORICA.

• We want to implement a globally distributed service system. 
• We want to make our service system transparent. 
• We want to create a decentralized service system
• We want to create a self-organizing service system
• We want to automate logistics as much as possible.
• We want to provide as much control over our services to the customer as possible. 
• We also want to give the customer the chance to play an active role in shaping/improving our products and services. 

Please provide feedback.

See the Services page.
Se the SENSORICA service system document.

Why would you join SENSORICA?

I am trying to answer this question, please provide feedback. You can edit the text, or you can use the comments associated with this post. 

To access the text in the VIEW mode click HERE. 

To access the text in the EDIT mode click HERE. 

This text is published on SENSORICA's website HERE.

Tibi

Duty vs passion

The main difference between SENSORICA and a corporation is that members of SENSORICA are only remunerated if their input reaches the market. Corporations pay their employees per hour and are obliged to focus activities. In this context, passionate work that is not aligned with immediate business goals is restricted, which limits the creativity of the organization.

Google understood that passion is the source of innovation. They allow their employees to spend 20% of their time on personal projects. G-mail, Adsense, and Google News were initiated by self-motivated employees. 3M developed a 15% time rule in the 1950s. Other companies are trying it too, but not everyone can afford it. There needs to be a large profit margin to sustain this type of couture, taking into consideration that creativity and innovation are highly unpredictable.

On the other side, gift economies like Linux, Wipedia and other open projects are thriving on pure passion. The adverse side is that contributors are not remunerated directly and in a tangible way for their work.

SENSORICA situates itself somewhere in between. Everyone is free to engage in passionate activities, and everyone understands that not all activities will bear fruits in the form of successful products. In other words, not all activities will be remunerated in a tangible way; this is the gift economy part of it. The members that are more motivate by tangible revenue will adhere to collective activities that promise market success. That is their choice, and this choice is informed by internal systems of market analysis and strategy.

The value accounting system we are designing must be compatible with this idea. All activities are recorded in detail and are evaluated. The revenues form every product exchanged on the market are redistributed to SENSORICA's members according to their individual contributions to every particular product. These contributions are recovered from the database on logged activities. Some activities might be counted as part of a product a short time after their completion, for others it might take a longer time. Some input might never see the market.

The reputation and the role systems will also pick up data from the database of logged activities. For example, members that contribute to viable products on a regular bases will be recognized as being revenue oriented and major contributors to the tangible wealth of the community. Other members that are mostly driven by passion will be attributed other roles and will gain a different reputation. Non-tangible value is still value, and some of us are driven by it. And one cannot exclude the possibility that one day an individual passion-driven contribution can find itself at the core of a very successful product.         

Revenue in SENSORICA is conditioned by market exchanges. This allows us to incorporate a gift economy within our model. Development can be market-driven or passion-driven. We get the best of both worlds.

See the first comment to this post for more clarification on the impact these new ideas have on our value accounting system.

References
Thoughts on Google’s 20% time

Emergent structure

Two weeks ago I had the privilege to spend some quality time with Venkatesh and discussed in depth about the concept of legibility, proposed by James Scott in "Seeing Like a State" and developed by Venkatesh  in his recent book Tempo. A few days ago I watched the BBC documentary The Secret Life of Chaos. These two events had a profound effect on my views about SENSORICA's structure.

I think SENSORICA should NOT have a predefined structure. Roles within our value network must be emergent and fluid. Circumstances define functional roles. As conditions change the organization reconfigures itself. SENSORICA will mold to changing patterns underlying our society and our economy.

We need some level of legibility to connect different value networks (like SENSORICA) together into a super-network. This connection is first established at the level of the value system, to allow an unhindered flow of value between all the nodes. Knowledge must also be able to flow freely within the super-network, therefore some level of codification is required. Individuals must be able to start producing value shortly after they migrate from one sub-network to another. The accommodation time and the learning curve must be reduced in order to renter the super-network rapidly reconfigurable/dynamic. But we also need to realize that there is a price to pay for too much legibility, as Venkatesh brilliantly points out (see this short video).

How are we going to induce self-organization? What guarantees temporal stability? How can we make sure that emergent patterns optimize creativity and productivity? How can we make sure that the outcome will be a humane and ethical environment? I put all my faith into the human being.

I believe that humans are capable of spontaneously creating stable social patterns if their goals are aligned and if they know how to achieve their goals. We don't need to create a structure, we only need to create the conditions for the structure to emerge and evolve. I am in the process of designing data analysis and visualization tools that I believe will induce self-organization. At this moment I see 3 important systems: value, reputation and roles. Follow the previous link for more.

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?

Presentation: SENSORICA

I am working on the first presentation about SENSORICA, for a meeting with some government agents working for different business development agencies, who are starting to open their eyes on open innovation. Your feedback is valuable.  

What is SENSORICA?

I am trying to define SENSORICA HERE.
Please give us feedback...

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). 

Open the Road Map document 

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!  

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.

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.

The meeting went... not so bad...

The scope of the meeting was to converge on a legal form/structure for our venture.

After bitting the dead horse for at least 45 minutes, i.e. talking about the corporation, we finally moved to other legal forms/structures and I presented my simple business model.

The member that had resigned was also at the meeting, strongly advocating for the corporation. In the end the resignation was reaffirmed. Another partner received my model with neutrality. The other one started to accept it and we had a very long conversation, seeking to improve it.

I still feel that my two remaining partners are not fully convinced that "open" is the way to go, but they are now moving towards my vision simply because of my central position within the venture, as the main technical person behind our prototype. I do NOT consider this a victory until my partners are not fully convinced that the open enterprise is economically viable, that it offers huge opportunities, and that it promises us all a better future.

Please feel free to comment on our starting model.

A crucial meeting - converging on a legal form and a business plan

During a recent Skype meeting, Shereef, co-founder of BetterMeans, suggested to chose my partners based on their level of acceptance of the open model. He's got a very good point, but unfortunately we don't always have this choice. Capital intensive innovation often takes place within a pre-established social context. In our case, our optical fiber sensor took shape around our physiology lab at McGill University. Moreover, when the means that lead to discovery and finally to a product are expensive, a strong interpersonal bound is needed. In this situation the choice of my partners is very limited, at least at the beginning of the venture. I cannot form a group according to my likings, I need to educate and to convince.  

I preparation for the meeting, I had a long face-to-face conversation with my new friend Sebastien Paquet. In a spark of genius, he made me realize that my proposition to my partners (to form an open enterprise) was a big piece to swallow. He used the metaphor of an emergent city to illustrate the idea of an organic, progressive growth. We concluded that I need to put forward a very simple business plan, one that promises immediate revenue and that bears the seed of an open enterprise. It will be my job to connect with other resourceful partners that will increase the value of our product, and to demonstrate the need to lower the barrier of entry, to open up, to be transparent. Gradually growing our value and our production capacity through open practices will convince my partners of the economical viability of this new business paradigm.

Thanks to Sebastien, I now have a very clear proposition to put forward at the meeting today, which will take place 2 hours from now. Stay tuned for the results...

What legal form should we chose for our venture?

This question was in our minds since the beginning, but now it's time to make a decision. In preparation for this event I tried familiarize my partners with the open enterprise concept and to harmonize our ideas on value exchange. I did my best to explain to my partners that the world is changing, that we need to use the new technology to its full potential, that today being open and transparent makes economical sense. We also discussed about the culture of open collaboration and we experimented with some tools we would need to support a large collaborative group. Despite all this preparation, when time came to decide on a legal form for our enterprise my partners unanimously voted for the f... corporation!

I obviously objected. Luckily I am the technical person behind our prototype, otherwise my opinion would not even count. So we went back to the drawing board. But in retrospective I tried to understand their reactions. My understanding is that my partners are somewhat accepting the idea that the world is changing in a fundamental way, but they think that it is going to take a very long time, and that the conditions which would make an open enterprise thrive are not there yet. My partners look at our prototype, they see value in it, and in a very pragmatic manner they decide that the best way to turn our know how into wealth is by forming a corporation, is by going the classic way, a way that is proven to work and that will continue to work for a long time to come, in their opinion. In other words, I think my partners want to make money and they think that they are taking an unnecessary risk if they embark on a venture that they do not understand.

I also tried to sell them the joy and the excitement of writing history by implementing a successful open enterprise. I tried to show them all the good that will come out of decentralization and of putting the power back into the hands of the creator/producer. It seams that non of that worked, which means that the current system still sends powerful signals and incentives to individuals to conform with it, even though people understand that something big is about to happen, even though they are convinced that the system is economically and morally bankrupt and it is in fact doomed.

I do not want to abuse of my privileged position within the group and to impose my will. I simply told them that the founder of Multitude Project CANNOT run a corporation. I tried to make them understand that this choice is beyond my limits. One of my partners resigned over my reaction. We are back to 3 members now, getting ready for another meeting in a few hours where we'll try to reach another agreement.     

Tools

The type of organization and the work culture determine the tools we use. Collaborative organizations make heavy use of online collaborative tools: shared databases, communication (email, mailing groups, netmeeting and conference, blogs), shared documents (text, spreadsheets, forms, presentations, videos, drawings), project management, coordination, outreach, data and process visualization, geomapping, etc. If the organization is open, these tools must also provide transparency and a low entry barrier.

I call an infrastructure of communication, collaboration and coordination a coherent set of tools that enable just that. I would also add to this infrastructure automated logistics, a set of tools that I consider still under developed. In fact, I predict that this field will fuel the next software development wave.

For most people, working within an open collaborative environment means learning how to use a set of new tools. From my experience, that is a problem. Anything new that requires learning and adaptation might scare your potential collaborators away.

Overcoming psychological barriers

• Lower the barrier by choosing familiar and easy to use tools.
• Provide a unified environment by building an infrastructure that allows users to jump seemingly from one service to another.  
• Explain the necessity each tool.
• Provide a collaborative learning space, designate resource individuals and set their priority for helping others to high, at least for the beginning.  
• more to come... 

The infrastructure

• modular: you can add and remove functionality without affecting too much the the entire system
• scalable: growing should not be a problem
• popular: potential partners are familiar with the tools and have easy access to them everywhere on the planet 
• low cost: this is also crucial if you chose to grow the organization in countries with low income; try to use open source tools or free online services as much as possible 
• outsource maintenance: focus resources on value creation rather than on the maintenance the infrastructure
• more to come...

My choice was Google free products and services. Google provides a great variety of tools that can be easily  integrated (see our growing infrastructure). Moreover, these tools are becoming ubiquitous, people are already familiar with some of them. They aren't very fancy, but they are very simple to use and are robust. Google also offers comprehensive help, nice video tutorials and a collaborative learning space, so we can outsource most of that. We are also confident that these tools will be offered for a long time, and in case they will be discontinued Google has a good record for providing alternatives and/or easy exit processes. I also like the evolution of Google products and services, they are getting better, fast.

My initial group is not very tech savvy, so starting on a Google platform is probably the best choice.

One problem is that we are putting almost our data into Google's cloud. But we are trying to build an open enterprise, so it doesn't really matter, as long as Google provides easy ways of exporting it, which is actually the case.

There is also BetterMeans. My problem with it is that it proposes a centralized form of organization, which doesn't map onto the Discovery Network blueprint. Other arguments can be extracted from here.

Culture and work ethics

In a previous post I cogitated about how to sell the "open" idea to my partners, who are very talented and resourceful, and can add value to the enterprise, but are not necessarily tuned with the new economical paradigm. In this post I expose another fundamental problem that needs to be solved before our new group can become creative and productive. Even if my partners accept to go open, suppose that they are now convinced of the economical viability of the open enterprise, it doesn't mean that they know how to behave in order to sustain good relations that foster creative and productive collaboration, within the context of a Discovery Network, of an open enterprise, of a decentralized community based on value relations, rather than power relations.

Working together requires social skills. Moreover, every environment has its specificity. We need to read the underlying norms and to adapt to them, to adjust our behavior in order to maintain the harmony within the group. An open collaborative group is built on a specific culture and work ethics, which members need to integrate in order to act accordingly, to stabilize the group, to make it functional. This becomes crucial as the mass of the group increases.

Let's put culture and work ethics in more concrete terms. It is better to talk about rules and norms, explicit or implicit, which people follow when engaging one another. In normal situations individuals join groups with some positive goals in their minds. To achieve these goals the individual must gain acceptance within the group and must act to preserve the group's integrity. Suppose you walk into a club and you join a bunch of friends, for the first few minutes you are in observation mode, you are trying to read everybody, and to understand the rules of engagement, these norms which regulate personal interaction. If your friends discuss about hockey and everyone is loud, even swearing from time to time, you will most probably adopt the same attitude. Your behavior would be very different in other circumstances, if you were joining an academic group for example, discussing politics and economics. We adapt to the group. We try hard to preserve its harmony. We mimic/pace others, we laugh when we are supposed to, we dose our criticism, we chose our jocks, we act accordingly to our position within the hierarchy of the group, etc.

We all possess the skills to adapt to different social environments. Our brains are wired for a social life. Some of us adapt faster, others can take more time. But our case now is a bit more complex. We don't have an established culture and work ethics. We are not just adapting to a new social environment, we are building one at the same time... I found a lot of literature prescribing rules and norms, but non of us have actually experienced them all at once.

I am already involved in different open collaborative projects and I can confidently say that I am the most experienced person in our group. I believe I should take the initiative to propose a way forward. I am going to take it baby steps. The first thing I am going to introduce is a concept proposed by the Coalition of the Willing, "open stewardship" (we are still refining it). I'll also try to cultivate what I believe are the two most important individual qualities in the open (new) economy, autonomy and initiative.

See an old article I wrote "The myth of autonomy debunked, what about the myth of initiative?"

The group: connecting at a deeper level and building consensus

The genesis of an open enterprise centered around a material product is somewhat different than that of an open source software project. Usually, the product idea emerges in a particular space, in a given context. The individuals around it are not always chosen, sometimes they are part of it from the beginning. These individuals have particular skills and they provide crucial resources that help to move the idea to the prototyping stage. Even before the proof of concept, before the working prototype is created, a groups is already formed. It is very possible that these people who first aligned their interests to concertize the idea diverge in their opinions on how to commercialize it. The group goes through a crisis during the transition from R&D to a commercial entity. This crisis becomes more serious if the plans for commercialization that are proposed are very different. This is what I am dealing with at this particular moment. What is the best way out?      

My own assumptions:

1. The world is going through a major transformation
2. The open model or something similar is a viable economical model 

Possible reactions:

• My partner doesn't agree with 1. and doesn't understand why we need to wary about 2. 
• My partner might agree with 1. but disagrees with 2.  
• My partner might entirely agree with 1. and in principle with 2., but the time has not come yet for 2. to be true.  
• My partner is in total agreement with me. 

Other possible sources of problems

• Technological literacy: The open model requires the use of specific internet-based tools. Some people are not very comfortable with these tools, and that might act as a deterrent. 
• Culture of work and work ethics: Evolving within an open collaborative group requires certain skills and an understanding of the underlying culture and ethics. Some people simply don't feel comfortable sharing, or don't understand the norms regulating social interaction within these types of groups. 
• Emotional barriers: 
• A feel of devaluation: Some people understand that the world is changing, and that despite their experience their skills don't match anymore with the new environment. This might feel as a devaluation and can be very frustrating.      
• Finding comfort in the familiar: The person might unconscionably chose to stay in denial, taking comfort in the familiar old world.   
• Fear of the new or of the unknown: The person might be uncomfortable with the idea of change.
• To risky: The person prefers to let others open the way, being not very confident in her own abilities. 

I asked Paul T. Horan, a collaborator from CotW to advise me on how to proceed. I find the process he proposed very promising and worth summarizing here. It consists of an open discussion in 4 consecutive steps.

1. Discuss our ideals
2. Find a common ground
3. Define long-term objectives
4. Establish short term goals

Participation is key to this process. No judgments are made, sometimes people are confronted to their own fears and biases during these processes and become vulnerable. Empathy and compassionate listening is key. The goal is to eliminate the irrational and to converge towards a rational middle ground.

Stay tuned for the results...

What is an Open Enterprise and why should we adopt it?

Two days ago we had our second group meeting (at this moment we are four individuals in the group). The initial goal was to agree on some very general principles for a value sharing mechanism for our enterprise. We had one week to write them down individually and the idea was to get together to reach a consensus. Everyone in the group was aware of the Discovery Network model and its Value Exchange Mechanism. Not everyone agrees with this model and at least one member finds it too radical or even non-realistic. So I thought that we needed to harmonize our opinions and explore alternatives to the DN Value Exchange Mechanism that would bind us together.

Right after we started I took the opportunity to frame the subject of the meeting as such:

Taking into consideration the vast outreach that the Internet provides us, and the collaboration tools we have at our disposal, we need to think of creating an enterprise capable of growing fast, encompassing a maximum amount of resources from around the planet, capable of managing very complex relationships, while remaining creative, productive, and very efficient.

In other words, I wanted to attract attention over the fact that the world today is not the same as the pre-Internet world. We now have the possibility to forge strong collaborative relations with individuals or small organizations from anywhere in the world. We also have the possibility to find potential partners, wherever they may be, very rapidly. On the distribution side, we can spread our technology a lot more effectively than before. Therefore, it would be a mistake to build our organization based on a classic model.

Very soon into the meeting I realized that our visions diverged at an even deeper level than I thought. I was the only one to communicate my list of basic principles before the meeting, and I realized that it was hard for my partners to do the same, probably because they didn't have a clear idea of their own of an organization that would be better suited for this new world. Perhaps some of them weren't even convinced that we need to change anything to the classic organizational model, which has been proven to be economically viable and still appears to be unmatched.  

Our discussion deviated from value exchange mechanism to what is an open enterprise, and why do we necessarily need to adopt it. I guess it's not so easy to sell the "open" idea...

At some point into the conversation we were talking about how to structure relations with our partners. Needless to say that the language used was heavily grounded within what I call the old economical paradigm (the one operating within the pre-Internet world), with clear-cut distinctions such as us/them, concepts like internal knowledge or trade secrets, references to legally binding transactions, etc. My position was to keep the barrier for collaboration very low, to open our knowledge base, and to operate on transparent processes. During this meeting, as many other times before, my position was qualified as idealistic and altruistic. In other words, one member thought that I was such a good guy, perhaps even a little bit naive, that I was ready to share our knowledge publicly and invite anyone out there to join our venture, hoping that something magic will come out of it, somehow, that karma will come back to us in one form or another.

I find this extremely evocative. But let me first say that these remarks had absolutely no emotional or egoistical effect on me, because I know my partners and because I understand the source of the problem. To answer to these remarks I first introduced the concept of enlightened self-interest, through the example of Richard Stallmen, a guy who gave big and who lives well as a result of that. Making the distinction between altruism and enlightened self-interest was the first step, after which I tried to explain how large scale effects can be reached by being open, transparent, and by lowering the barrier to entry. The essence of this idea is that the Internet provides us with widespread outreach and with the possibility to build vast collaborative networks, with no geographical constraints. Being open allows our technology to spread faster. Potential partners can find us, instead of us spending energy finding them. Making the group more fluid, by lowering barriers allows knowledge, know how, and resources to flow through the organization. Eliminating defensive mechanisms also helps to create a better collaborative environment. After reaching its critical mass the organization can enter a fast growth phase, network effects kick in, it becomes an attractor, the technology becomes ubiquitous, many applications are developed. 


I also want to thank Sebastien for attending our meeting and for giving us his views on open collaboration.


From Michel Bauwens on Quora

An open enterprise is:

- based on a commons of knowledge, software and design, to whom everybody can participate given certain rules pertaining to quality etc .. 

- is managed collective and transparently by all those who contribute, augmented with a role for those who are affected by its activities; it is based on open book accounting 

- does not restrict access to the commons on which it is based, but it sells any scarce goods and services it may produce at a fair price; the revenue is used both for its contributors and the maintainance of the wider commons on which it depends 

- as regarding its material infrastructure of production, it based on the shared ownership of its owners, eventually augmented and combined with other stakeholders 

- the enterprise is mission-oriented around its commons, and uses profit only in accordance with its mission 

- it takes account of all positive exernalities through revenue or benefit sharing, and of negative externalities 

- it acts in solidarity with the wider world, not just for its own members

Selling the "open" idea - part 2

See part 1

In the last post I identified three ways of being "open". All these three ways lead to something very new. As it starts to generate value, the open enterprise begins to act as an attractor, spreading the collaboration meme and making the idea of competition lose its sense. If you find a successful open enterprise commercializing a product similar to one that you want to develop, why in the world would you compete with it? The door is wide open for you to join the open enterprise, to add new features to the existing products, to take advantage of the already existing pool of resources. I think it is wiser to network with the open enterprise, to add to its economical activities and benefit in doing so. Remember, the Value Exchange Mechanism on which the DN is built rewards you in proportion to the value you put in. Imagine that you present a new car design to GM and that they grant you access to their facility to build it, and that they allow you to take a cut from the profits generated by selling your model, based on your contribution. Stop dreaming, this will never happen because GM is NOT an open enterprise. It is NOT designed to serve YOU the creator and the worker, but to exploit human capacity.

If something in the last statement feels even slightly repugnant for you, that's because you see another important thing: the future massive transfer of talent from closed, hierarchical and monopolistic institutions of exploitation to the open enterprise. If we build an economically viable open enterprise it WILL spread, because it makes people feel better, empowered, respected for what they are and valued for what they can provide; because it offers a  fair deal to everyone. This is why I want to launch our invention in this new way, even before the paradigm shifts in the mainstream, knowing that I need to swim against the current, because I think we are in tune with the future. In my opinion, the "open" idea is a big idea, it is the way of the future. So I tell my partners to look around and see everything opening up, software, the media, education, governance, etc. There is already a clear pattern emerging. 

Usually, when I reach this stage in my discussions I get the following reaction: "You can't make competition disappear, this is what drives innovation and production". I agree that competition has its role to play. It actually doesn't disappear, it is displaced and somewhat hidden. The DN's Value Exchange Mechanism doesn't allow free riding or parasitizing. Your reward is proportional to the value you put in. Hence there is a race within the DN to get your ideas accepted by the rest of the group and to contribute as much as you can. Our goal is to enable large scale collaboration and I think the best way to do that is through openness. I also think that the DN's Value Exchange Mechanism preserves powerful incentives for individuals to innovate and to work hard.  

See also

Open Source engineering approach to build a car?

Outsourcing and innovation

Selling the "open" idea - part 1

Building an open enterprise is building an organization, is forming a group. Some individuals and some organizations that I think can bring some value into the venture don't necessarily value the "open". How do I convince them about the economical viability of the concept.

The world is changing. If you read this blog I assume we agree on this, I don't think I need to provide an explanation. But not everyone sees it. Openness, sharing, collaboration, empowerment are the new buzzwords. But not everyone understands their true meaning. I believe that the open enterprise can be justified on purely economic bases. For me, openness is not just a trend. It does NOT stem from a sterile ideology. It is a new way of engaging innovation, production and distribution, which takes advantage of the new possibilities introduced by the new technology. It is the most effective way to tap into the creativity, resources and production capacity of the entire planet. It is the only way I know to cope with the increased complexity of our interconnected world. It is the most effective way to reach large scale effects and to benefit from them. But not everyone get's it...

What do we mean by "open"? In this context of an open enterprise "open" means different things.

1. Full discloser of knowledge. The technology behind the products is open, there is no secret, and it is not protected by patents (or by the mafia). Moreover, everything is built on open standards. 
2. Transparent processes. The open enterprise if a glass wall factory with glass wall offices. Anyone from the outside can take a look inside to see what's happening and how things are done.
3. Easy access to contribute/collaborate. The open enterprise is not only a glass wall factory, but its doors are also open. There are some processes in place which give access to the manufacturing floor, and gives permissions to take part it innovation, production and/or distribution, but these selection processes are only based on value. In fact, going back to the previous point, there is no clear cut between inside and outside.      

From my experience, the most feared "open" is the first one. Telling your partner that you don't care about intellectual property is really destabilizing. The idea that you can only extract value from knowledge by controlling it seams to be very deeply ingrained in people's minds. I found that starting by telling my partner that the patent system is doomed (The collapse of the patent system) helps a little, but it doesn't solve the entire problem. Agreeing on the idea that the prevalent system is collapsing doesn't fix the best replacement solution among many other possible ones. I still need to make my partner believe that being entirely open is economically viable. But an explanation only goes so far, it would be much better if I could point to an example. The problem is that they are hard to come by. Existing (semi)open enterprises are mostly experimental or under development.

The second "open", referring to making processes transparent, is also a new and strange concept. It just doesn't fit with the idea of competition. I believe that competition works, i.e. it gives good economical results within an ecosystem lacking efficient means of communication, collaboration and coordination. The new technology favors social entities, individuals and organizations that are keen on collaborating and able to build and evolve within collaborative groups. Once we introduce this technology into the system we bias it in favor of social entities. Collaboration becomes a more suitable strategy within a world enhanced with this kind of technology. Humans are capable of both, killing each others like animals and cooperating and loving each other. So there is no problem with the substrate, the world can shift from being predominantly competitive (the western world) to being predominantly collaborative. Once we agree on this we are just a step away from accepting transparency. If I don't have enemies why would I hide behind a wall of bricks? But there is more than that. Being open enables me to get access to large scale effects, by allowing the enterprise to grow fast. Because we are transparent, potential partners can come to us instead of us spending energy to find them. Transparency also allows us to forge more stable and more productive relations with our customers and with the local community.

I found that "open" in the sense of easy access is more easily accepted, especially in the case where resources are scarce. It becomes a value proposition for my partners. If we don't have any funding and we cannot pay employees or for some essential services, or tools, or whatever, it makes sense to expand our venture by partnership. If we cannot buy value in we can still get it by sharing ownership, by leveraging our potential as a group. There is nothing new or strange in this idea, so it passes well.

See part 2.

The seed value

How do you start an enterprise, be it open or not?
Any enterprise starts with an idea. If we are talking about a commercial enterprise this idea must be a product idea. But most commercial enterprises are collective endeavors. In other words, we need to build an organization. we need to convince people to collaborate, to deploy some of their resources for the project. In order to do that we need to make them a value proposition. What's in it for them?

The seed value is a source of value. From it stems different other values that our potential collaborators might be interested in. In our particular case, our seed value is a new sensor prototype. This device embeds some knowledge and constitutes the materialization of some effort. It also demonstrates that a group is already formed,  a locus of know how already exists, having the capability of putting ideas into practice, of creating things and making things work, of solving real problems. Moreover, this device responds to a particular need. Therefore, it also represents potential. It promises something down the road.

The seed value establishes a locus of innovation, creation and production. Some people might find value in exchanging knowledge and knowhow within our collaborative space. Others might be attracted by potential revenues, by a market-share promise, etc. The seed value acts as an attractor and I see it as our most important asset when we kick-start our venture.

But empty promises cannot go far. Our seed value must be a fecund one. What about our optical fiber-based force/displacement (tactile) sensor? You'll be the judge.