I don’t know how many discussions I have heard where I have come away thinking that they missed the most important thing shaping everything in our world, namely connectivity and the expansion of networked systems of organizations. My most frustrating experience is listing to people talk about the rise of China and comparing the political tensions it creates to a hundred years ago – analyzing international politics like we still live in a disconnected world and nothing has changed. I feel like most of the analysis of our world that we hear from academics and media alike has now at best become only 50% relevant because it continues with a narrative about how the world works as if the rise of networks does not really affect anything – implicitly assuming that it will all just fit in site existing boxes.
This revolution in connectivity is all around us and continuously expanding, but by its very nature connectivity and networks are difficult to see and touch, so we all nod our heads that “yes” there is some kind of network revolution taking place but we go on talking about those things that we can touch and see and are familiar to us. Maybe never before our incapacity to really think about things in new ways has been so starkly revealed to us.
The Changing Organization
When we step back and ask how do we organize our world I think the answer is constraints, we organize our world based upon physical constraints. Because of this, we live in a world of borders. Patterns of organization form and expand outwards geographically until they bump up against another organization that has formed in a different location and then a boundary forms that comes to structure and define the overall system. Cultures, languages, political systems and jurisdictions, technology infrastructure, businesses, farms, transport systems they all seem to follow this same pattern.
Each wave of social and technological development has enabled us to expand these systems farther out, from tribes to chieftains to empires and states. As the social, cultural and economic institutions became standardize and rationalized and the technology infrastructure enabled us to go farther faster we moved from the boundaries being local to regional to national. But what if those constraints were pushed so far that they almost disappeared? What if we could move something around the planet at the speed of light, what would happen then? This is not a hypothetical question as it is precisely what the revolution in information and communications has done.
The real change is from disconnected to connected. The connectivity is virtual in terms of the telecommunications networks that are still rapidly expanding as we build out 5G and the ongoing development of the Internet of Things. But more than this it is also about physical connectivity, infrastructure, roads, airports, bridges, rail, ports, these are the underlying technologies that overcome physical barriers and start to bring humanity into common networks of exchange. It is the twin revolution of information technology and globalization that pivot around cities. According to the UN-Habitat, the world will build more infrastructure in the coming decades than has been built since the beginning of human civilization. Over that same time, the population connected into the formal global economy will expand hugely. Cities are the physical super-connectors in the networks of globalization, the fact that we now have more people living in cities than not is symbolic of the huge transformations underway as a consequence of this raw connectivity of people and things.
I think professor Ian Goldin captures this well when he notes “80% [of people] living in a major city or only an hour away and of course not only physical but also virtual connectivity, so we move from a world of only half a billion people connected in the 1980s to a world of six billion people connected today, five and a half billion more people.”
“Everyone, everything is connected all the time and networks are increasingly large, the number of people you are connected with is growing exponential” – Eric Hippeau
New Organizational Paradigm
While connectivity disrupts it is also the ground conditions for building something truly new. It enables us to shift from building systems based upon physical constraints to ones that are based upon the principles of connectivity, of networks, of systems. While at the same time it creates the new challenge of designing and building complex systems. When things are disconnected they are defined by their boundary conditions and internal structure but when we start to connect things they are shaped by their connectivity, their relations to others, the structure, and rules of the networks they form part of.
Manuel Castells puts it well when he says “the logic of the network is more powerful than the powers of the network.” This, in fact, summarizes the story of disruption for existing organizations by the new networked platforms. The logic of their networks has become more influential in shaping our world than of the existing centralized powers that previously dominated. As the connectivity proliferates, the resources flowing on those networks proliferate and the strength of those networks grows the same will be true for all organizations, both private and public.
Often we find that our organizations ignore the distributed nonlinear networks of connections that are proliferating around us, dismiss them until one day we wake up and we find that the resources flowing through those networks is much greater than what any one organization can command. The paradigm then suddenly flips and we find that our once powerful organization is now just one node within a much greater network and it is the logic of that network that really matters.
I think the story of the disruption of the media industry is one example of this – the New York Times now finding itself as just one voice among a vast network of the internet, bloggers, websites and social media. That is the problem with linear thinking, it leads us to focus only on big causes and blinds us to the nonlinear change processes that are happening and how over time they will sum up to something much greater than their parts alone to change the paradigm; at which point it is too late.
It is this transformation from things to connections that is really driving the transformation of our economies, and it is why the concept of services is so important in understanding the new economic paradigm forming. What Uber, Airbnb, and co. have done is to leverage that underlying transformation, to turn products into services – from things to connections, service processes that connect things. At the same time, we can note how the design challenge changes from building things to building systems and processes. As the connectivity becomes stronger those networks push out to interconnect more and more disparate things into larger and larger service systems and the key challenge shifts to that of designing complex service systems.
“Hyperconnectivity is the notion that people are connected to each other and to different devices and devices are connected to each other in ways that they haven’t ever been in the past that creates an interesting proposition because if everyone can theoretically be connected to every other person on the planet at any point then that means we are thinking less about linear systems and much more about networked systems… so the business models change fundamentally by thinking through networks as opposed to thinking through linear chains.” – Dr. Tony Salvador
There are two widely divergent ways of thinking about how technology affects society. The technocratic view that posits that social outcomes are determined by technological changes, and the humanist perspective that posits that technology can’t change anything just accelerate existing patterns. I think both are partially correct and partially incorrect.
I think technology does not determine social outcomes but it does set the parameters for them. Technology makes things possible that were previously not possible and sets the context within which people make their decisions about what they will do, but the outcome of those decisions is not determined. Industrial technologies made new things possible and new patterns of social and economic organization emerged out of that based largely on what is viable given those technologies, but not everyone has chosen to live like that nor is the same path to industrialization determined for all the different societies and there are widely divergent outcomes, from dictatorships to democracies.
I think the same is true with the technologies of connectivity, it enables new possibilities but just like the industrial technologies they can lead to dictatorships or democracies. I think today everyone around the world is looking at these emerging networks and asking how can I have an influence on those or control the flow of resources on these emerging networks, whether that is from startups in Silicon Valley and Bangalore to hackers to the Chinese government, to each and every one of us as we post our tweets and hope that people will see and share them.
There is an “empire of networks” emerging that will change how we organize societies and economies around the world and in that is the possibility for systems change. It is precisely because of this infrastructure of connectivity that we today have the opportunity to innovate in whole systems, but the question is how will we use that opportunity.
This is why we need new ways of thinking because without it we will fail to grasp the new possibilities and realize them towards whole systems change, simply putting a veneer of technological change on top of the same underlying patterns as before. But not only do we need systems thinking to conceive of different ways of doing things it also has to be connected to the technical know how to actually build new systems based upon those principles – because if we don’t do that then someone else will build them eg Facebook or Google based upon the old logic. We need both the new ways of thinking and the technical means and both working synergistically to realize systems level innovation.
Author: Joss Colchester