An Argument for Heterarchy: creating more effective organizational structures

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The latest issue of People and Strategy Journal has an extremely interesting Point/ Counterpoint feature. Download the full article and responses here.

Karen Stephenson, a leading network theorist and practitioner, wrote an article Neither Hierarchy nor Network: An Argument for Heterarchy, examining how heterarchies, that bring together elements of networks and hierarchies, are the most relevant organizational structures for our times.

Leading people in the field were invited to respond to the article, with responses from Edgar Schein of MIT, Robert Eccles of Harvard Business School, Charles Handy, Tracy Cox of Raytheon, Patti Anklam, Barry Frew of Center for Executive Education, Art Kleiner the editor-in-chief of Strategy+Business magazine, and Ross Dawson of Advanced Human Technologies (me :-) ).

My response is below. If you are interested in how organizational structures can be more effective in a connected world, I strongly recommend reading the full article and responses – this is an extremely topical issue.

Heterarchy: Technology, Trust and Culture

Stephenson is absolutely right to emphasize both the rapid rise in interconnection that individuals, organizations, and societies are currently experiencing, and the resulting interdependence that stems from that. Relatively few have yet grasped that the degree of interdependence generated in a global connected economy significantly changes the drivers of individual and collective success. Central to these drivers are the organizational structures that coalesce value from disparate participants.

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Telstra releases social media policy: it’s time for organizations to get their act together

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This morning’s Sydney Morning Herald displayed a prominent headline Telstra lays down the law on Twitter. The article began:

Telstra has become the first major Australian company to set down guidelines on the use of Facebook, Twitter and similar websites by its employees.

First? According to whom? As noted by Stephen Collins, the Australian Public Service Commission publicly announced protocols for online media participation in December. A number of major Australian companies have established guidelines for social media, they just didn’t issue press releases about it as Telstra has.

In any case, Telstra’s social media policy a solid document and it’s good that Telstra has both created it and released it publicly. (See the social media policy itself and the blog post launching it.) Companies that have not addressed these issues are essentially creating a liability out of what could be a strong positive for the organization.

The extensive background to the announcement (including all the fun and games of @fakestephenconroy) is given in an article on ITNews titled Telstra staff given rules on use of social networks. In the article I am quoted:

Ross Dawson, chairman of social networking analyst group Advanced Human Technologies, described Telstra’s new policy as “solid and straightforward.”

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Des Walsh video interviews at Enterprise 2.0 Part 2: Stephen Collins, Ross Dawson, Steven Noble

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Following Des Walsh’s video interviews with Chris Lampard, Jenny Williams and Peter Williams at the Enterprise 2.0 Executive Forum, here are three more interviews from the event with Des’s accompanying blog posts…

Stephen Collins (trib), acidlabs

Des Walsh blog post on Stephen Collins interview

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At current growth rates everyone in the US will have a Twitter account by August 22 2009!

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ComScore has just announced that the number of Twitter users in the US went up by 131% in March.

twitter-trend-apr09.gif

At this rate, everyone in the US will have a Twitter account by August 22 of this year.

In other news, CNN (which just acquired CNNbrk) and Ashton Kutcher are battling it out to be the first to reach one million followers.

With many million of synapses now firing frantically, the global brain is finally awakening…

Yet another logo competition – first public news of a new influence ratings engine

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I’ve just posted my third logo competition on 99 designs in as many months, as I am now firmly in venture generation mode, and have found that 99 designs can provide excellent results if you approach it the right way. After rebranding Advanced Human Technologies (full launch announced shortly) and launching events firm The Insight Exchange 10 days ago, I have just put up a logo competition for Repyoot, which will be announced soon pre-beta as what will soon emerge as a leading influence and reputation ratings engine.

So if you’re a designer or know a great designer who would like to create a very influential logo design, check out the logo competition!

Largest ever organizational network analysis shows how social networks drive performance

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For years now I have been trying to get the message out to senior executives that effective social networks are critical to business performance. By now that is well understood, in part supported by the large body research and academic literature on how social networks in and across organizations drive results and performance.

Now researchers from IBM Research and MIT have undertaken the largest study of its kind ever. BusinessWeek writes that Researchers at IBM and MIT have found that certain e-mail connections and patterns at work correlate with higher revenue production.

The report itself, Value of Social Network — A Large-Scale Analysis on Network Structure Impact to Financial Revenue of Information Technology Consultants, provides detail on their findings – for those interested in these issues it’s well worth a read.

In summary, there were four key results:

1. Structural diversity and centrality of social networks are positively correlated with performance for both individual consultant and project teams.

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What will Australian consumers pay for 100Mbps with the NBN?

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Last night SBS World News ran a segment on the Australian National Broadband Network plan, including Prime Minister Kevin Rudd and the leader of the opposition debating its merits, and a piece on how much broadband is likely to cost consumers, which took some snapshots from an interview with me.

Unfortunately the small quote they took from me and its positioning in the story seemed to imply that I thought that $100 per month was acceptable pricing. Here are the points that I made while I was being interviewed:

* While some analysts have suggested that consumers will have to pay $100 per month for broadband access to make the project commercially viable, there are highly questionable assumptions in their methodology.

* Consumer telecoms pricing has been and will increasingly driven by bundling and integration with value-add services. As I pointed out yesterday, telcos need to shift to value-add services, including content, and this will drive how services are priced.

* People will be prepared to pay a little more than they currently are for vastly superior services. Not three times as much, but a little more.

* The pricing of any service is only meaningful in a market context. Pricing has to be set relative to demand and competitive alternatives rather than the cost of provision, and the landscape for broadband offerings is rapidly evolving.

* The Australian government, if required, is likely to effectively subsidize consumer broadband access. There is no reason to think at this point that it will be necessary, but if so this will likely be an investment that will yield substantial and commensurate economic and social returns.

* This all comes back to the politicians’ argument as to whether commercial entities will want to invest in the project, which is clearly fundamental to its success. The government says they will, the opposition says they won’t. While there is still a lot of number-crunching to be done, my bet is that there won’t be a problem getting investors, not least because there will be significant strategic benefits of being involved in this project. Let’s see.

Eight key issues in understanding Australia’s National Broadband Network

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Yesterday was a busy day. I was called early to come in to the Sky TV studies to respond to the government’s announcement from its National Broadband Network tender, got stuck in traffic and arrived half way through the announcement, and was then immediately put on Sky Business live TV to give my thoughts. I was then interviewed on the separate Sky News program, a multitude of radio stations, and my comments ended up appearing in the New York Times, Forbes, and The Guardian among other global press, fitted into a busy day of work commitments.

So just now getting a chance to write a few quick thoughts.

1. Overall this is an exciting and very promising move.

If one of the bidders had won the tender it would have been a fizzer. 12mbps by 2012? That would probably not have kept Australia at its middling to poor ranking in global broadband connectivity. Fiber to the home and 100Mbps to 90% of premises is worth playing for, and could provide the connectivity that will drive Australia’s economy forward. I have long argued that for a geographically isolated country such as Australia living in what is truly becoming a global connected economy, connectivity (both the infrastructure and the attitudes) are fundamental to our future. I now have more reason to be optimistic about our country’s future than I did early yesterday.

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Why major media will quickly resume buying innovative companies

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The latest research from specialist investment bank Jordan Edmiston shows that M&A activity in media, information, marketing, and technology sector fell by over 90% year-on-year in first quarter 2009. While the figure seems dire, much of this is due to this being a phase of rapid price adjustment, as Jordan Edmiston points out. First valuations at new levels need to be clarified by further transactions.

The chart below shows the most active strategic acquirers over the last five years in the sector. Some of these – such as Thomson Reuters, Reed Elsevier, and WPP – will continue to be very active in years ahead. Other companies will start acquiring more rapidly.

mostactivestrategicacquirers.jpg

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Availability of talent drives entrepreneurial innovation – the story of Silicon Valley unemployment

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The human toll of unemployment is stark, as is being experienced around the world.

The most recent unemployment statistics for Silicon Valley below illustrate how the region has greater cyclicality in unemployment than almost any other region in the US. In good times unemployment can fall to almost nil, in bad times unemployment rises faster and higher than most regions.

SVunemploymentFeb09.jpg

The recent dramatic upturn in unemployment is likely to be far from peak, with for example the mooted IBM – SUN merger potentially leading to 10,000 layoffs, a large proportion of which would likely be in Silicon Valley.

What is bad news for some is great news for others. Bringing ideas to market takes talented people. In good times those people are either not available, or cost too much for start-ups to engage. Today there are once again fantastically talented people who are looking for opportunities, and willing to work for lower – or even no – income in return for a share of what might become big later.

This balances out to a large degree the far more constrained availability of investment capital. The money may not be flowing into start-up companies at a massive pace, but they need less.

So don’t expect innovation in Silicon Valley (or anywhere else) to dry up. The spigot of one of the key enablers of innovation – talent – has just been turned up high. Entrepreneurship is being democratized as more people with ideas and energy are able to execute their vision, rather than being constrained by lack of resources.

This is just one key driver today resulting in the pace of technology innovation going up, up, up…