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Download Chapter 3 of Living Networks on Emerging Technologies

Every chapter of Living Networks is being released on this blog as a free download, together with commentary and updated perspectives since its original publication in 2002.

For the full Table of Contents and free chapter downloads see the Living Networks website or the Book Launch/ Preface to the Anniversary Edition.

Living Networks - Chapter 3: The New Organization
Leadership Across Blurring Boundaries

OVERVIEW: The boundaries between organizations are blurring as technology reduces the costs of transactions. It is becoming essential for companies to work closely with their customers, suppliers, and partners, however this involves very real risks. In this world leadership is required to take whole industries and supply chains into new ways of working based on transparency, collaboration, and sharing value. Those that embrace the networks and lead the way forward will reap the greatest rewards.

Chapter 3 of Living Networks - Commentary and updated perspectives

From the original writing of Living Networks I felt that the issues raised in chapter 3 were at the heart of what the living networks are about. The key concept here is that of 'blurring boundaries', something we are experiencing across every domain of society and business, including organizations, industries, and countries.

A quotation I discovered since writing the book, and have used extensively over the last years in my presentations, expresses this perfectly:

"Finite players play within boundaries; infinite players play with boundaries."

This quote comes from the delightful and wise book Finite and Infinite Games by James Carse, which looks at how we either limit ourselves or open ourselves to infinite opportunity in our lives. While it was published in 1986, its messages are more relevant than ever today.

I recently did the opening keynote on The Future of Business at the Tandberg Summit 2008, which brings together the clients, distributors and partners of the global videoconferencing firm, and stayed for most of the first day. I found it extremely interesting being among a large people who were concerned with implementing video in organizations, as these are almost entirely different people to those concerned with Enterprise 2.0 approaches, though their objectives and issues are very similar. More thoughts on that in a moment. It’s probably worth setting the scene with a review of the conference by CRN Magazine, titled Tandberg Summit 2008: Video killed the radio star. The entire article is worth a read – I’ve excerpted below the section covering my presentation:

A highlight of the conference was a keynote by Ross Dawson, chairman of Future Exploration Network, who provided insight into the dynamics within an organisation and the video communications market. Referring to internal business practices, Dawson stressed the importance of collaboration between employees and identifying personal qualities that may help foster growth.

The current presentation at the Network Roundtable conference is from Tamara Erickson, who has an article out in the latest issue of Harvard Business Review on Eight Ways to Build Collaborative Teams. Her organization, The Concours Institute, has recently completed an extensive study on collaboration in over 50 teams in 15 multi-nationals. She defines innovation as the combination of two previously unrelated ideas. Team complexity, including group dversity, size, and geographic dispersion, all led to lower levels of performance. In addition, the more educated the group, the less collaborative they tended to be. For complex teams, you have to invest specifically if you want them to perform well.

In the study Erickson identified eight factors that demonstrably improve team performance:

It’s one thing to discuss whether Facebook is a useful professional social networking tool. The answer is: it is if you want it to be. It’s another issue to uncover which are the most relevant social networks for your professional life, and to use these effectively. The most important connections for most professionals (who are deep knowledge specialists in their domain of expertise) are their peers. As such, it often makes sense to belong to specialist social networks.

This relates strongly to the well-established field of Communities of Practice. Many organizations have established communities of experts in specific domains who share insights into what they’re learning, answer questions, and build knowledge collectively. Less often communities of practice span organizational boundaries, for example with clients or suppliers. Certainly there is almost always some kind of boundary on who can participate. Now that, over the last seven years or so, we have worked out the fundamentals of effective online social networking platforms, these are ripe to be applied to specialist domains. This enables an opening out of what were formerly closed communities, to provide useful platforms for experts to share not just knowledge, but also social connections. It is important to recognize that the current crop of social networking tools are now highly evolved applications that go substantially beyond the tools that have previously been available. Since being a professional of any kind requires keeping on top of massive amounts of information and new developments, effective social networks are invaluable in keeping on top of that.

The New York Times Wall Street Journal has a good article titled Social Networking Goes Professional, which outlines some of the current crop of specialist professional social networks, and their business models. The ones they mention, plus a couple of others I’m familiar with, are:

The most recent issue of Image & Data Manager magazine has an article titled Knowledge management gets a social life, drawing extensively on an interview with me. Sections of the article that quote me as below:

“Organisations have been trying to find ways to make knowledge management more productive, but a lot of problems have stood in the way,” says Ross Dawson, chairman of Future Exploration Network. “But we have now moved into a new phase of emerging technologies.”

Dawson likes to refer to this organisational shift as Enterprise 2.0, where the tools and approaches of Web 2.0 are now captured inside the enterprise. “It’s about getting group input to create an emergent response, getting many people to create input,” says Dawson. “You can click input, tag input and rate input and as you get more input on creating outcomes, emergent results occur. Things get better the more people that use them.”

Just as Web 2.0 tools can determine what does and does not work online through the power of mass appeal; this user-generated input can also assist everday business operations. “In the enterprise you can map sales – you could for example, find out what the weather was and how It affected sales, and make it easier for anybody to bring together different data-sets,” says Dawson. “This is where it all starts to be knowledge management.”

For organisations, harnessing the capabilities of Web 2.0 could involve replacing the traditional taxonomy with a user-defined folksonomy. “A taxonomy is where people analyse and prioritise ways for classifying information,” says Dawson. “A folksonomy is built by everyone, there is no architect and no designer. It’s created by the people who actually do the work.”

In the last few days I’ve made a couple of references to Particls, first in writing about our Web 2.0 in Australia event next week, where we had invited Particls to present as one of the most interesting applications on the scene, and an hour ago in my Top 60 Web 2.0 Applications in Australia list posted on Read/Write Web. As of earlier today, Particls has moved to public beta, and deservedly attracted substantial attention. The best reviews out so far are from Read/Write Web, Techcrunch, Mashable!, and StartupSquad – best to go there for a full rundown on Particls.

I think Particls is important for two reasons. First, it provides a completely friendly interface to RSS with far superior functionality to your usual feed aggregators. RSS is one of the most important foundations to Web 2.0 and the promise of the Internet, yet a minority of people really understand what it is, and use it well. Particls is the first of what I hope are a whole generation of tools that embed RSS in ways that make it invisible and provide access to the information people want.

Second, it is a solid and useable implementation of information filtering that shows how this landscape may unfold moving forward. Active filtering is an issue I’ve been strongly interested in for the last decade. For example, back in 2001 a company called Worldstreet was using XML-based document tagging to improve the flow of research documents from investment banks to funds managers, allowing high priority and relevant information to cut through to the users from the myriad of information they were receiving. The company was bought by Thomson Financial and incorporated into their Thomson Connect product, with its best features ultimately disappearing. Now that we are all experiencing the same degree of information overload as the funds managers of yesteryear, the world is now ready for sophisticated multi-tier filtering of information.

Having had the Particls toolbar installed for just a day now, I can confirm that the content streaming through is highly relevant to me, and I have better access to the information that’s relevant to me. Those that can use these kinds of tools well will be highly advantaged in our intensely knowledge-based economy moving forward.

Click on the image here to download Particls, including a feed to this blog (which you can delete if you wish):

The Sydney Morning Herald has a very interesting full-page article today by Brad Howarth titled It’s web take 2.0, which delves into some of the business applications of Web 2.0. It covers a broad range of technologies and companies, including social search engine Swicki, scalable virtual world Outback Online, community space Tangler, and Web 2.0 initiatives from Kimberly-Clark and World Wildlife Fund. The article links to this blog among a few other Web 2.0 references, and quotes me on the enterprise applications of Web 2.0:

According to social technologies researcher Ross Dawson, some information-intensive organisations, including law firms and banks, are the most active in investigating the benefits of web 2.0 technology, as an extension of ongoing knowledge management developments.

"Web 2.0 in the enterprise is about enabling people to better find information and work with it," Mr Dawson says. "There are some sweet spots, which are very natural applications for blogs and wikis where it makes a lot of sense. And these are projects, competitive intelligence, and many other things where you are trying to get broad information and input on a specific topic."

In the case of competitive intelligence, for instance, a wiki can be set up to allow employees to input information they may have learnt about their organisation's competitors, and rely on their colleagues to collaborate or correct their entries. The same can be true of corporate blogs.

"There's a lot of cynicism around whether it is worth doing or not, but done well, in the right sort of organisation, it is a way to get greater visibility and awareness of capabilities across the organisation."
Mr Dawson also believes that blogs and wikis can become an alternative to email.

"Email as a communication platform is experiencing breakdown because people have too many emails. If you can start to shift activity outside of email, that's enormously valuable and more effective and more productive."

Many years ago I was already referring to “communication breakdown” in the corporate use of email (at the time about financial markets participants, whose email inboxes overflowed before anyone else’s…). The next phase of evolution of corporate communication and work processes must be about moving beyond email as a tool. People are familiar with it, and it provides a single portal to communication, but it is a massively ineffective tool for many business communication needs. Web 2.0 tools offer a ready-made, easy to use alternative for some business applications. Most projects, for example, would function far better using blogs or wikis instead of email for communication. There are certainly other approaches to transcending the email inbox as our primary communication tool. However Web 2.0 tools are already at hand to vastly improve corporate communication, if we choose to use them.

I've written at length before about these issues, including some of the investment banks' initiatives and successes in moving beyond email, initiatives from IBM, blogging shifting into Enterprise 2.0, and so on.

In the next couple of weeks I’ll be releasing a Web 2.0 framework which will put into context both the consumer web and enterprise applications.

The power of Web 2.0 is driven by mass participation. High-value outcomes emerge from tapping our collective use of the web. Clicks, links, ratings, tags, and social connections are all used as fodder to “teach the machine” how to give us relevant and personalized information, entertainment, interaction, and applications. Without that rich input from all of us, there would be no way for the whole new wonderful world of the web to be created by the “power of us”. I often use the example of del.icio.us. We all used to bookmark what interested us on our web browser, so only we could use that information. As soon as we start bookmarking publicly, it is not just other individuals who can gain value from what we find interesting, but far more importantly, collectively the millions of bookmarks compiled allow the most compelling information on the web to become visible to the people who find it most relevant.

It is important to understand that this power is only unleashed when people choose to publicly disclose, in this case, their bookmarks. If everyone preferred to keep their bookmarks to themselves, there would be no value. One of the most interesting insights of the last few years is how open people have proved to have been, in disclosing bookmarks, profiles, preferences, thoughts, behaviors, and far more. Twitter, a “micro-blogging” service, allows tens of thousands of people to disclose the minutiae of their lives. Justin.tv seems to have been the catalyst for many more who are opening out their lives on video for all to see. We are finding ourselves to be exhibitionists. And that is a wonderful thing, because without it, we would not be able to create collective value in the information economy.

Into this world Cluztr has launched a new service that allows you to share your clickstream (everything you do on the web) with your friends. In their words:

Cluztr lets you share your web-browsing with your friends and discover new sites and people relevant to you and your interests.
• See who's on the same web page as you.
• Find out what sites your friends are visiting and follow them around the web.
• Chat and leave messages on any website you visit.

This is a pretty high level of exhibitionism – it’s like having all of your friends (or everyone in the world if you so choose) looking over your shoulder as your browse the web. Yet there are also solid privacy provisions in place, allowing full control over disclosure of web browsing behaviors. Cluztr can use aggregated data to create valuable insights into what’s hot on the web for any particular individual, without disclosing individual clickstreams. There is real value in social bookmarking, as it shows an explicit opinion about value, but tracking clickstreams arguably has the potential to gain richer insights into behaviors and interests, and thus greater value to all of us.

Mark Evans suggests that Facebook should consider acquiring or copying Cluztr. I suspect that this kind of service will do better initially as a stand-alone, as long as it has sufficient perceived trust. After that, certainly it will be a target.

Duncan Riley at Techcrunch calls Cluztr “social bookmarking meets Big Brother. It’s the Del.icio.us Homer Simpson would use… I should be horrified by a service that tracks and publicly exposes every site you visit, and yet for some reason this one stands out. Perhaps like much of society as a whole I’ve become engulfed by a wave of voyeurism, and Cluztr wets my appetite.” However voyeurism – individual and collective – requires exhibitionism. Fortunately, many of us are proving to exhibitionists.

Today BRW launched its flagship Australia Online issue (which is only available online at a hefty subscription price!), covering an interesting range of topics including the rise of online advertising (over $A1 billion annually now), e-commerce, online classifieds, travel, internet TV and music downloads. There is a truly atrocious full page picture of me facing their article “Business blogs on” (Don’t look – please!). This was intended to be a follow-up to their Blogging Power article of December 2005. In my interview for today’s piece, I tried to stress that the issue for corporates was no longer just blogging per se, but how activities across the enterprise are aggregated to enable more efficient working. The writer seemed to base the entire article on what we covered in our discussion, though only used a few anodyne comments from me. Certainly there is a real issue in getting corporates to use blogs for their external communication. Inside the organization, the game is now not about getting people to blog. It’s about creating an infrastructure whereby comments and activities by individuals have value across the enterprise. I’m hoping that Australian corporates will be able to leapfrog the phase of experimenting with blogs to start implementing enterprise-wide systems to tap collective behaviors, including document creation and viewing, bookmarking, annotating and more. A lot more on this later – I am currently developing a Web 2.0 framework (including enterprise and consumer), which I’ll launch sometime in the next few months.

Another article in the same issue was on internet TV and movie downloading, looking at competition among the online video platforms in Australia. I was quoted in the article (somewhat accurately) as saying:

Future Exploration Network chairman Ross Dawson says: “It surprises me how slow free-to-air TV channels have been to stream programs on the internet, especially as they can get a better idea of their audience on the net, and tailor advertising to suit them.”

Dawson says device convergence – such as Microsoft’s Xbox initiative – is also critical in how the market evolves.

“Manufacturers know convergence [will happen] and are desperately seeking to be at the centre of it,” he says. “ It happened with Apple. The sold people a physical device, an iPod, which led them to an internet site to make music purchases. Now this encompasses podcasts and video. They have moved from selling a single device to having a strong relationship with consumers selling content.”

Have a look at what I’ve written on how European telcos are positioning themselves to get some more insights into the foundations of this strategic positioning game.

Over the last few years the use of narrative and storytelling has become an almost mainstream approach to organizational change and development. Steve Denning, first at the World Bank, and then in his own consulting practice, has been at the forefront at spreading the gospel. Anecdote, an Australian-based consultancy, has become prominent in the field, sporting among others Shawn Callahan, who previously worked as regional leader of IBM’s Cynefin Center, at the time lead by Dave Snowden.

Anecdote is running workshops on Narrative Techniques for Business in Boston and Seattle at the end of March – full details here. Hopefully these will be well-attended – effective use of narrative inside organizations can be extremely powerful in building collaboration, culture change, uncovering strategic issues, and capturing implicit knowledge, among other rather useful outcomes…

This Friday I’m doing a lunch presentation titled Knowledge, Networks, and Social Media in Melbourne to the KMLF (originally known as the Knowledge Management Liberation Front), a group of knowledge management practitioners, and the Victorian Public Sector Continuous Improvement Network. Details on the event are here – the organizers say all are welcome. The description of my presentation is:

Knowledge management has provided a foundation for many of the most exciting developments in business today. Network approaches, including social networking platforms, organisational network analysis and industry network development, are proving to be fundamental business tools. The media landscape is being transformed by social media, including blogs, podcasts, photo and video sharing, user filtering and how user content is being integrated into traditional media.

Enterprise 2.0 is the term being used to describe how enterprise blogs, wikis and other collaborative tools are transforming knowledge sharing and co-creation in the organisation. Those with a deep background in knowledge management are eminently qualified to apply their experience and skills to these transformative domains; they represent massive opportunities for KM practitioners to create value.

Back in the 1990s I was usually identified with the knowledge management (KM) movement (though I always disliked the term). From the beginning of this decade actively sought to disassociate myself from knowledge management, because I felt the term had already become archaic, and it certainly didn’t encompass the scope of my interests. In an article on The Future of Knowledge Management published in KM Review and other publications in 2004, I explained why I felt it was time to move on from knowledge management, at the time identifying five successors to the movement: social networks, collaboration, relevance, workflow, and knowledge-based relationships. Moving on, this year I have found a large proportion of my energy spent on the future of media and media strategy, closely linked to my work on social networks, both inside organizations and in technology-enabled social media.

What has struck me over the last years is that while knowledge management is not perceived as a highly dynamic space, the skills and capabilities that were developed in the 1990s and beyond within the knowledge management movement are immensely relevant today and in the future. The KM label is unfortunate, yet the issues practitioners have been grappling with for a long time now, such as fostering collaboration, virtual work, enhancing social networks, serving relevant information, reducing overload, and so on remain absolutely central issues. The terminology and tools have substantially moved on, yet the fundamental problems are not new. As such, the wheel does not need to be reinvented, and those who have been in the knowledge management space can apply their expertise with enormous relevance. The language has changed, and I personally don’t regret that KM has been largely sidelined as a term. Yet there are big opportunities for the people who can adapt the knowledge organization skills they have developed over the years, and the organizations who apply them.

John Hagel has a very interesting piece on zero-sum thinking - the idea that there if one person wins, another must lose. He draws out how this is epidemic in the business world. A great example is how companies treat their suppliers. In what way do companies do better if their suppliers suffer? Yet that seems to be how many suppliers are managed today, in squeezing them as much as possible. The trick is to move beyond the single dimension of price. Once you do that, there are unlimited ways to create value for both parties. Yet there are far more ways that the implicit assumption of a zero-sum world drives business strategy. Intellectual property and organizational design are just two examples. The vast majority of value creation in the economy today is collaborative, with more than one winner. Executives must actively seek “non-zero-sum” games, in which you can collectively increase the pool of value available. This shift in mentality is in fact required for survival. Zero-sum thinkers and players will find business swiftly becoming more difficult. If you’d like to learn more about zero-sum thinking and how to transcend it, read the great book Nonzero, by Robert Wright.

I originally wrote about the open innovation model of Innocentive several years ago in Living Networks (see page 12 from selected excerpts from Living Networks). Last week The Economist named Innocentive’s chairman Alpheus Bingham winner of its business process innovation prize for developing the company. Innocentive was originally founded by Eli Lilly, which recognized that the solutions to specific issues in the drug development process may be easier to obtain outside the organization than by trying to do everything itself. By defining specific solutions that it is seeking, it can open participation in its R&D process to any scientist anywhere on the planet. Scientists win a pre-specified reward for solving the problem, and in return sign over the related intellectual property rights. Now other companies including Boeing, Dow, Ciba, DuPont, Procter & Gamble, and Novartis have joined Innocentive to seek their own solutions to R&D problems, helping build the critical mass which makes Innocentive a true innovation exchange. Innovation no longer needs to happen entirely in the one organization. It can be unbundled into different elements, allowing participation from the best and most relevant talent in the world. It is great to see Innocentive’s success, as this will help pave the way to more initiatives and new approaches to opening out the innovation process.

Investment bank Dresdner Kleinwort Wasserstein is using wikis, blogs, instant messaging, and other collaborative software tools to supplant email, according to an article in this week’s issue of BusinessWeek titled Email is So Five Minutes Ago. J.P. Rangaswami, Dresdner’s CIO, an ardent critic of email, says that in some cases use of these tools is resulting in project-related email being reduced by 75% and meeting times being halved. There is no question that email as a corporate communication tool is in fact more representative of communication breakdown. When a significant proportion of executives get literally hundreds of emails a day, it is hit-and-miss whether any one email will actually be read or answered, even with the best of will from the recipient. While email will not disappear for the foreseeable future, the problems with email overload and more are rapidly accelerating the uptake of collaborative software tools. For specific, focused applications, blogs and wikis are admirably suited. One of the most relevant applications, and where there is strong traction already, is in project management. There is defined scope, known yet diverse participants, and a need to make issues quickly and readily visible to all. These requirements are usually better addressed with collaborative software than with email. Expect to see email fairly rapidly shift out of favor as a core project management tool, now that there are simple, inexpensive, effective alternatives.

I've just spotted a recent article in BusinessWeek called The Power of Us that provides a great overview of how mass collaboration is driving the economy. It refers to a number of examples I described in detail in Living Networks, such as Eli Lilly's Innocentive, which enables companies to draw the best innovators globally into their internal R&D programs. As evidenced again by the references in the article, the success of James Suriowecki's outstanding book The Wisdom of Crowds has played a powerful part in making people realize that collaboration - if correctly designed - is far more powerful than any other approach. The tools and business models that support that will be central to the next phase of the global economy.