What Happens when institutions become networks?
by Robert Pye, February 13, 2017

This question has been bugging me for a few weeks now. I think the myriad debates I see, hear and read about the rise of nationalism and the US becoming an autocracy are missing a key point. In contrast to the stark choices of a utopian/dystopian binary choice for our future, I imagined “institutions” cooperating to upgrade their practices to become more network centric.  I think we are beyond that now.  Individuals are “practicing” and organisations are not ready for it!

For years, I’ve contrasted institutions and networks and imagined (prayed, hoped for) smooth transitions to more agile network-centric organisations. This is kind of a “both” view rather than an “either / or” view. It’s incrementalist rather than a total revolution – but things do need a shake up.

However what I now see as inevitable (thanks Donald, Nigel and Marine!) is that the transition may be anything but smooth. Amplified, distorted, challenged and moderated by social media, the impending danger is that the path ahead looks anything but smooth. “We live in interesting times” as the saying goes.

Let me explain. For about 20 years I’ve been experimenting with ways to enable organisations to become more network centric (and resilient, agile, non-hierarchical, less command and control) Why? My belief is that organisational architecture needs to better mirror our underlying sociology now that everything is connected to everything else and a networked society (Castells et al) has emerged. The commodification of labour makes less and less sense in an robotised/AI world that is “post-industrial”.

Through Ethos VO, over the past seven years our work has intensified as 130 others interested in this line of thinking have bravely worked together to help ourselves and help “legacy” organisations make the transition to a new world by collaborating with one another to solve complex problems in ways that improve lives: citizens, employees, customers. Kind of collaborative, social innovation. I still hope legacy organisations can make a smooth transition of course but over the past few weeks my thinking has evolved – as inevitably ones thinking does.

Networks versus Institutions?

My established “frame” contrasted “networks” on the one side and “organisations” on the other. Network-centric organisations like W3C (the Internet standards organisation) or Wikipedia don’t really have central command posts that direct all activities. Rather most of the value comes from the nodes. Institutions have a head (Board), hierarchies, perimeters, fixed assets etc. etc. I’m sure you know the picture.

I used to see a “smooth” transition being enabled by technology, culture and behaviour more aligned to “network centricity” more networked organisations such as outlined by Jon Husbands excellent “Wirearchy” work. This might still be an end-point but we might be in for a bumpy transition.

What I’m experimenting with today represents a somewhat starker choice. A somewhat more pressing issue. What I want to share are two thoughts: firstly based on my experience in Ethos and second based on my observations of what is happening around us.

Life at Ethos

My first observation is based on my experience within Ethos. When you give people a voice more than an “office” or a “role” they will tend to use it! That creates a mouthwatering opportunity for increasing purpose, passion, meaning and hence productivity. In my own case I have been retained by Ethos longer than any employer could hold me, I have earned less cash than at any time before, I have worked harder, longer, with more energy and so on. Many Ethos partners tell me they have worked harder than any time in their life. So on a good day this is simply amazing. But what about bad days?

The problem is that individuals are not commodities. No two people Are *exactly* aligned. Sometimes misalignment can be 90 degrees. Others 180 degrees. Conflict is more frequent. Conflict resolution is tough. Without the “means” to unemotionally and continually capture two-directional feedback an organisation can be hopelessly paralysed by infighting or the overhead of communication and alignment. Having experimented with “silo-busting” approaches for 20 years inside big companies and small I’m pretty confident that we are at the start of out learning journey, not the end!

So this is all very well for Ethos and great learning but my second point and the title of this blog is that I believe that this “voice” within all of us represents the proverbial curates egg. Opportunity and challenge in equal measures. The challenge I experience at Ethos is inevitable for ALL organisations and ALL of us.

Harping back to that media sage of the 60’s The medium is the message”. And what message is it giving us? Our voice. Amplified. The opportunity for all of us to discover purpose, meaning and passion. But not without cost. And the challenge for institutions is how to mediate, moderate and harness that potential. Commodification, to me at least, does not seem like much of an option anymore.

Life in the wild

My second observation relates to what is happening in the geo-political space. Our world today is enabled by tech and social media. It is playing out on our screens and devices but not (for most of people) in our work, roles and the “offices” we hold. Hence the original frame of “networks verses institutions” might have to become “individuals adapt their insitutions with networked thinking”

This has started with the distributions we are labelling nationalism, autocracy and the backlash from white and blue collar workers against globalisation and automation which is hollowing out their social contracts enabled by the last wade of industrialisation.

However, when individuals are no longer able to separate the “role” or “office” of their institution from their “internal voice we arrive at the point we are now. The issue is that organisations (mine included) are not sufficiently well adapted to be able to cope. This is pretty important and urgent.

Whether Trump or John Berkow (the speaker of the Commons whose job is ostensibly one of referee) we are all increasingly aware that we have a voice. We care about things. Different things, for sure but we have passion, values, meaning and purpose. These are innate. Not extrinsically given.

The problem is not nationalism verses globalisation or capitalism. The problem is that our operating system is broken. Or, more kindly, we need to download the latest patches but we’ve not written the code yet!

The giant within waiting to be unleashed here is a world where *our* voice increasingly can and will be heard. Not the voice of the “role”. The problem is that we are ill-equipped to deal with a networked society. One of the people for the people (sound familiar?)

The Chancellor is interested

I met with Phillip Hammond (the UK’s Chancellor) last week and we had a privileged 40 minutes chatting 1:1 about the correlation between employee engagement and productivity. The key question was “How do we get engagement?” The answer is both obvious and complex. One simply has to have a trustworthy two-way relationship with your employees. One not based on “information asymmetry” – nor purely on market price-signals. This is industrial thinking and has to be upgraded somehow. 

It seems obvious to me that an individual value proposition for an organisation or nation state that makes a promise (which in itself is an outdated industrial concept) and fails to deliver will have to cope with every customer, citizen and employee holding them to account. In real time. From *within* their own organisations; not just by the hardening of their perimeters. The recognition that individual pathways transcend organisational boundaries is a good place to start.

Thus when rhetoric such as “bringing back our jobs” and other such hopelessly flawed assertions play out and the dysfunctional side of the curates egg kicks in (longest time in history to appoint Trumps top team) the maverick creates a paralysed state not an efficient one. It will not be long before the gap of dissatisfaction demands a better set of answers.

There are no easy answers.

Despite 7 years of intense learning at Ethos it would be wrong to claim we have all the answers. I don’t even think we have many of them. But we’ve made plenty of mistakes and we have a few good stories and plenty of thoughts on how to avoid the treacle.

Tim Bernars-Lee, Vint Cerf and others talk about the re-democratisation of the web as guarding against the one thing that could steal the greatest opportunity of all time – allowing our voices to surface and create a better kind of democracy.

The power of the “filter bubble” operated by the likes of google and Facebook is such that our greatest fear should not be of a crazed despot becoming president but the “commons” that exists today that we call “The Internet” being taken away from us. Being enclosed, or used for extractive purposes.

But what is the answer? I certainly don’t know. We need different tools, mindsets, philosophies and approaches.

I sense we are at the start of something very significant.

But that’s just my view. My lonely voice. Not the view of some office, tower or institution!

Robert Pye
Robert Pye
Founded Ethos in 2010 with Tony Clarke . Have been working on networked business models since the late 90's. Living a dream: playing on both sides of the fence! Institutions and networks.   Bragging rights: ‘My work is my hobby. My profession is being a father!’

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