How blockchain will eliminate the difference between inside and outside the business

Click to read article in Sloan Management Review

Chapter 3 of The Escher Cycle describes how

it no longer makes sense to think of “inside” or “outside” the business — they do not exist. The business is not choosing whether to carry out each process inside or outside itself. It is choosing between different forms of contractual agreement as the best way to achieve the levels of value and cost that are needed: with employees or with suppliers.”

Customers are just as much a part of the business model as employees and shareholders.

Companies like Airbnb and Uber have shown how to put this thinking into practice. These businesses provide a platform that people can use to sometimes play the role of customer, sometimes employee.

Now this article in the Sloan Management Review describes how blockchain technology will again transform the way businesses are organised and managed, blurring the distincion between ‘inside’ and ‘outside’ still further.

Not only does the blockchain enable parties to transfer information — something that has already been made much easier by the Internet — but because the blockchain is distributed, public, and encrypted, parties will find it easier to establish trust, thereby making it possible to do transactions that would otherwise have been too risky.

It allows companies to eliminate transaction costs and use resources on the outside as easily as resources on the inside.”

Under this vision, the ‘inside’ of the business could shrink to become only the ability to formulate a series of contracts with different ‘external’ parties to carry out different roles. “If you carry out this action or create this result by this date I will pay you this amount on this date, and the outcome will be recorded on the blockchain for all to see in future.” The more standardised or commodified the activity, the easier it is to contract with someone ‘outside’ the business to do it.

And as this second article shows, IBM is positioning itself as “the go-to business blockchain.”

Research shows bodily RNA can transfer into sexual reproduction

exosomes_genetic_information

The publishers of this article lie outside the mainstream, but the article is well-referenced.

New research has found that changes to bodily RNA can be transferred to spermatazoa and hence to offspring. This “[collapses] the timescale necessary for the transfer of genetic information through the germline of a species (e.g. sperm) from hundreds of thousands of years to what amounts to ‘real time’ changes in biological systems.”

For me it would explain, for example, how human beings have managed to evolve such varied racial features in different parts of the planet, although under classical models of evolution there has not been enough time for this to happen since homo sapiens left Africa only about 200 thousand years ago and spread across Asia only 75 thousand years ago.

The findings also reinforce the view simply that we are all part of one large interconnected organism. This organism has become increasingly differentiated over the past 3.5bn years (when the first differences appeared in the Last Universal Common Ancestor or LUCA that once covered the planet), but it still co-evolves as a single interlinked organism, via an interconnected Escher Cycle of different mechanisms, of which these new findings are merely part, and the sexual reproduction we are more familiar with is another part.

 

You can read the full article here:

http://www.sott.net/article/310487-Previously-thought-impossible-Body-cells-transfer-genetic-information-directly-into-sperm-cells?utm_content=buffer39fc0&utm_medium=social&utm_source=facebook.com&utm_campaign=buffer

Experience Changes Biology

The research increasingly shows that even at a genetic level our experience (ie the actions we take) shape the design contained within our genes, in an Escher Cycle that started before we were born and continues throughout our lives:

“A cell is a machine for turning experience into biology.”

Implementing Finland’s Basic Income

Chapter 3 of The Escher Cycle includes a description of how to improve any process.

The steps are:

  1. Define what you want the change to achieve (and what you want it to avoid)
  2. Identify alternative approaches of achieving that
  3. Get input from stakeholders and choose what looks best
  4. Test it out
  5. Decide whether to go ahead, cancel the idea, or run an adjusted trial
  6. Communicate what you have decided works best
  7. Roll-out and continuously improve

This is essentially the approach that Finland have just followed in getting to their rollout of a national basic income:

Finnish_Experiment

As a result they are the first country in the world to experiment basic income on a large scale.

You can read more about this here.

What Business Cycles Can Teach Us About Evolution (and vice-versa)

We often hear how businesses need to learn from nature. But have you ever stopped to wonder how evolutionary theorists might learn from business?

The Escher Cycle revealed the seven core activities that drive business advantage, and showed how the last of these, the Escher Cycle, provides a self-reinforcing cycle of business advantage.

Here is a longish piece I have just had published that describes how the same pattern explains how life emerged from non-life, how that life then evolved into all the millions of species we see around us today, how progress works, as well as how that same pattern also shows and explains how Toyota-Lexus and Volkswagen are the largest automotive manufacturers in the world today.

I’ll be interested to hear your feedback.


Continue Reading >

The Escher Cycle and Jungian psychology

Part of Jungian psychology includes the idea that we interpret the world in terms of archetypes.

There are several of these, but the work of two Jungian analysts, Robert Moore and Douglas Gillette, has distilled them down to just four.

By combining the two essential qualities of people’s psychology as either active or passive and feminine or masculine, they identified four essential Jungian archetypes:

  • Sovereign
  • Warrior
  • Magician
  • Lover

Screen Shot 2015-04-22 at 22.50.57

There isn’t space to go into detail here, but other archetypes can be seen as combinations of these fundamentals. And all four archetypes exist to a greater or lesser degree in everyone.

The Sovereign represents the ‘passive masculine’. If you think of Continue Reading >

Wanted: flexible corporate strategies for fast times

Screen Shot 2015-03-28 at 13.35.36Writing in the Financial Times this week, Andrew Hill says that “People often think business is about strategy but it’s actually one part strategy and nine parts execution.”

Leaders managing in uncertain times, he says, are looking for tools and frameworks to help them plot a path.

The Escher Cycle is a book that integrates strategy and execution. It is both “A unified theory of business” and “A blueprint for winning any game your business chooses to play.

The book starts by asking what are the fewest activities any business needs to do to be successful. It then builds step by step to identify these activities, and provide a simple focused framework describing how to carry out each one.

How well these activities are carried out in comparison with rivals is what defines business advantage.

Together, as one reviewer put it, they describe how to run a business “as a living organism.

This, surely, is exactly what leaders seeking to plot a path through uncertainty need.

Self-Reinforcing Cycle of Leadership

Another example of the Escher Cycle has popped up in an unexpected place: personal leadership.

Suppose you have decided to change something in your business. You’ve decided to create a new product or service, open a new location, close a location, change the way that something in your business gets done, or whatever.

The first thing you do is create a plan. You use your personal insights, and the experience of any other leaders involved, to design how you want the organisation to be and how you’re going to achieve that.

Then your plan becomes a change project: you and the team work together to implement what you have planned and bring about the new way of doing things.

In the process you all have your own individual experiences of the change. You all experience it from different perspectives, depending on your roles, and you interpret those experiences in different ways.

Later you reflect on what worked, and what didn’t, and these experiences then get converted into new insights and rules of thumb. “Getting stakeholder buy-in is the most important part of the process,” “Getting stakeholder buy-in is a waste of time.” “A 15% margin for contingencies is really important” or “A 15% margin for contingencies is way too high.” And so-on.

When the time comes to design the next change project you use these insights and experiences to plan what is possible and how you will acheive it.

The repeating cycle looks like this: Continue Reading >

Toyota

Over the past decade Toyota has grown to catch up and then overtake General Motors as the world’s leading automotive manufacturer.

This short video explains how this remarkable gain can be understood in terms of the self-reinforcing competitive advantage that is generated by the Escher Cycle.

The second largest automotive manufacturer is now the Volkswagen group, and this company runs a similar cycle:

Screen shot 2015-03-09 at 09.13.06

 

The rise in network thinking

Social_Network_Analysis_VisualizationA nice article here in the Scientific American, on ‘How Networks Are Revolutionizing Scientific (and Maybe Human) Thought’.

“Modern research in sociology, psychology, neuroscience, and anthropology is showing that… what we are like as individuals critically depends on how we are linked socially and emotionally with others, in relational networks reaching far and wide.”

For example, we have historically tended to think of people as being part of races, nationalities, ethnic groups, societies, or cultures. But then network thinking shows us that we are connected to anyone else in the world by only six degrees of separation.

This way of thinking collapses the world immeasurably, and creates many more possibilities than the old worldview.

For example, it influences the way ideas spread. The networks we are part of are partly driven by ethnicity, sexual orientation, and so on, but everybody is linked to everybody else within six degrees of freedom.

This makes complete sense using The Escher Cycle. Continue Reading >