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Archive for the ‘Networks’ Category

Networks and Autonomy

“Networks  are voluntary connections between autonomous peers.”

Connected AutonomyOrganizations are autonomous when they have final say over their own future. People are autonomous when they have final say over their lives. I might be autonomous at home but not at work, by the way, just as I’m free to decide who I vote for in an election or what movie to watch this weekend but not to decide whether to merge my organization with another one. That latter type of decision is checked by an organizational reporting structure, so I’m not acting autonomously when I make it. Similarly, a division of a corporation isn’t autonomous because final say on important matters sits outside, in the parent corporation.

What does this have to do with networks? Hang on, we’re getting there – but first a word about relationships that are voluntary. As an employee, the connection I have with my organization is not voluntary – it’s part of an institutional hierarchy just like the corporate division that reports to its parent. These relationships are power relationships – institutional power relationships, to be specific. They’re not voluntary, and they’re usually backed up by the force of law through things like employment contracts and corporate bylaws.

Networks are an alternative organizational structure to hierarchies; not necessarily better, just different. You join them voluntarily and they connect you, not to a reporting structure, but to peers. Networks connect peers in ways that help them safely and voluntarily shed a little bit of their autonomy – just enough to be able to get work done together.

To illustrate, let’s talk about a partnership, a simple form of network that connects just two entities. True partnerships are between equals. When two people decide to marry or move in together, the resulting partnership is voluntary and between equals. When two firms decide the advantages of ongoing collaboration outweigh the costs of coordination, the resulting partnership is voluntary and between peers.

In true partnerships, the relationship between partners is definitely not a reporting relationship where one controls the other. It’s much more complicated and nuanced than that – just ask anyone whose been married or in a significant relationship for any real length of time. The same is true for partnerships between two independent companies.

It’s also important to note that if a third party were to force the collaboration, the connection between ‘partners’ wouldn’t be voluntary and they wouldn’t really be acting autonomously. In networks, there is no external controlling force. It’s not only the individual members of the network that are autonomous; the network itself is also autonomous.

Why is autonomy so important to networks? Because, as we’ll see in future posts, they run on a different set of principles than organizational hierarchies. Networks collapse when we use the wrong operating manual to run them. Networks aren’t the answer to everything. Many situations really are best solved by organizational hierarchy. Lots of good stuff has been written about working with hierarchies. You’ll find it in the “management and leadership” section of your favorite bookstore. In comparison, less has been written about networks, so that’s the focus here.

Understanding that organizations voluntarily give up a little bit of their autonomy in order to work together is a critical first step in understanding how networks function. How that happens and what that means is were things get a little more interesting…


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JP Rangaswami’s post on platforms is worth reading. Rather than try to summarize it myself, I’ll just excerpt a few highlights:

His definition of platforms:

  • something that is a foundation, an enabling environment, upon which others can build things, make things
  • something that exists for a specific purpose (or set of purposes), and which invests in capabilities related to those purposes
  • something that then makes it easy for people to use those capabilities
  • something that does all this in a commercial model that facilitates the creation and development of new products, new services, new markets, new marketplaces
  • something that can coexist with other platforms and ecosystems

And a bit more about platform API’s:

Anything that aspires to be a platform needs to engender this trust. So when you look at “platform APIs” don’t be surprised at what they do at their core. They’re usually about a very small number of things:

  • user directories, adding and removing people, grouping and classification
  • identity, authentication and permissioning
  • service and data inventorying, cataloguing and access
  • publishing of things digital
  • distribution of things digital

This is a great piece and much of it centers on the notion of trust – users trusting the platform and platforms trusting other platforms. That’s critical for the kinds of service interoperability that is required for an open cloud computing to succeed.

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Paul Greenberg has an interesting post in which he puts a stake in the ground in defining Social CRM (sCRM). There’s a lot to take in from that post, but here’s his relatively compact definition:

“CRM is a philosophy & a business strategy, supported by a technology platform, business rules, workflow, processes & social characteristics, designed to engage the customer in a collaborative conversation in order to provide mutually beneficial value in a trusted & transparent business environment. It’s the company’s response to the customer’s ownership of the conversation.”

And here’s the super short, Twitter-friendly snippet:

“The company’s response to the customer’s control of the conversation.”

These are good working definitions but I want to hone in on something else from Paul’s post. It’s the notion of the “personal value chain.” Here are some points on this from his post:

  1. That means that we need to recognize that there is an extended enterprise value chain which consists of the company, its suppliers, vendors and agencies that the enterprise has to deal with. There is a separate “personal value chain” which is the total greater than the sum of its parts of what an individual customer needs to achieve whatever their personal agenda is.
  2. For the company to succeed, since they cannot control the personal value chain of the customer, nor should they want to, they can only provide what the customer needs to satisfy that part of the customer’s personal agenda that is associated with their enterprise. That means products, services, tools and experiences that allow the customer that satisfying interaction.
  3. The intersection of the extended enterprise value chain and the customer’s use of part of his personal value chain to satisfy that personal agenda creates the possibility for a collaborative value chain that engages the customer in the activities of the business sufficiently to provide each (the company and the customer) with what they need from the other to derive individual and mutually beneficial value.

Now, this is what I find most interesting about the whole idea of Social CRM. What we’re talking about here is exposing business processes. That is the essence of any good CRM consulting work. How do you expose the business processes for building relationships with customers? In traditional CRM consulting, the focus is on exposing those business process to employees. The goal is to expose those processes in ways that help employees add value to customers.

Social CRM is about exposing those business processes not just to employees, but also to the customers themselves. I’m not just talking about self service processes here though I would argue that is an important step on the way to sCRM. What marks the shift to sCRM, in my opinion, is when customers begin using the tools to extend the organization’s business processes in ways that interact with others.

That’s what I find interesting about Paul’s notion of the “personal value chain” and the way he’s talking about it intersecting with the organization’s value chain. CRM’s early adopters out-competed rivals by using the tool to better manage relationship management processes internally. Tomorrow’s sCRM early adopters will out perform their rivals by melding collaborative processes with their customers in ways that dissolve the edges of the org chart. Those organizations that excel in exposing business processes to their customers are the ones who will tap the energy and value of their customer base – and that is a power that dwarfs all others.

Everything we are talking about here boils down to generating value to customers. In traditional CRM that value came from providing better service through better understanding. In sCRM that value comes from providing better ways for customers to serve their personal networks in ways that take advantage of the organization’s core services. In a recent post, I outlined another, more specific way in which organizations share value with customers through the notion of “transitive novelty.” The value of sCRM shares an important similarity. For the key to success in both cases, lies in how effectively the organization is able to flow value into the hands of its customers in ways that enable that customer to extend that value in turn to their customers.

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Michael Silberman has a really interesting summary of how things came together recently for the 350 Global Day of Action. The whole piece is worth reading and if you haven’t looked at the amazing array of images gathered from around the world as part of this organizing effort, it really is worth spending some time on the 350.org website.  Prepare to be moved.

One thing I thought was particularly interesting in Michael’s piece is this paragraph:

Notice how May Boeve refers to herself as a coordinator — not an organizer — when I ask her about her work (video). Sounds minor, but the reality is that no dozen people could have directly organized more than 5,200 simultaneous events on every continent using traditional organizing methods. In most campaigns, community organizers cover relatively small territories, working closely with volunteers to train and empower them to take on the campaign’s work. In this campaign, the “organizers” were the volunteers, not the staff.

This notion that “the organizers were the volunteers, not the staff” is subtle but extremely important. Modern, large-scale organizing efforts operate on a scale that can no longer be effectively organized purely by staff.

This is about pushing the power of the organization beyond the edges of the org chart.  In this model, the role of the staff shifts to that of “coordinator” – the coordinators of other people who are doing the actual organizing.

Network coordination is the new name of the game.

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