Become Intentional With Gamifying Life
The Ultimate Motivational Device
Quantify Our Lives
Interest-Free Mutual Credit/Alternative Commodity-Backed Currencies
Demurrage
Finance
Equity-Based and Royalty-Based Crowdfunding
Equity-Based and Royalty-Based Impact Investment
Enterprise
Social Entrepreneurship
Cooperatives
Open Enterprise: Applying Open Source Principles To The Way We Work
Because our founders are driven by a shared, stated set of values, they limit promotions
according to those who share those values. Restated: Promotions aren’t based on office
politics. An employee’s contributions and ability to increase profits are encouraged, but not
with increased decision making ability. Instead, let’s say that decision-making power within
the organization is limited by an employee’s ability to demonstrate their alignment to the
core, shared values of the organization.
Under such a model, the corrupt, unethical or mis-aligned behaviors that plague modern
corporations like Merck, Enron, Monsanto, or Exxon seem impossible to pull off. An
organization of this kind is well protected against losing why they do what they do in the act
of doing it.
Goretex Case Study
Best ideas rise to the top by being voted on like open source software
WD40 Crowdsourced Ex
Consider what would happen, if the decision making power of our fictional organization was
distributed democratically. Decisions are made openly, and at the smallest level necessary.
That is, decision making is limited to those whom the decisions significantly effect. Local
problems are voted on locally. National problems are voted on nationally. Shipping problems
are handled by the shipping department. Company problems are voted upon and addressed
by all members of the company. Decisions are more informed because strategy and
intelligence is being crowd-sourced. Work becomes infused with a sense of purpose and
empowerment.
Consider, now, giving increased autonomy to those who perform a specific task. What
happens when they have room to choose how they perform the task? They are free to get it
done however they want. Anything unethical, or that doesn’t meet stated outcome
requirements can be refused by the organization. Inspiration and innovation explodes.
People have room to experiment—no small benefit to those who know trial and error is the
breeding ground of success.
In this model, citizens are joined and held together first and foremost by a common
purpose. Individuals are given increasing say according to how clearly their voice can speak
for the shared values of the whole. Individuals are rewarded according to the quantity and
quality of their own efforts and contributions. No more, no less. Individuals participate,
motivated by their own desire to achieve the aims of the organization.
BetterMeans is itself, an Open Enterprise. The first, in fact. It was formed to promote the values of openness, transparency, autonomy, contribution-based-rewards (meritocracy), democracy, integrity,
and values-oriented, purpose-driven work—
Keep in mind that the model is designed to be usable by any organization. In time, we
believe that any company that does not adopt a number of these core principles and
implement them effectively will, eventually, be left behind by those who do.
Values-Centered Formation
The Open Enterprise begins with one or more individuals deciding to collaborate with each
other in order to further a set of shared values. This is highly important in an open
enterprise. Why? Because in an Open Enterprise, order is derived from shared intent, not
control.
If the group initially forms around a set of goals, this is not necessarily a problem. Goals
cannot exist without some values driving them. Before proceeding, the founders need to
determine which values are the common values driving each participant toward the agreedupon
goals. Ideally, these values should be prioritized and qualified so they can be more
easily understood by new potential members of the Open Enterprise. If these values are
substantial enough to motivate it’s members, the Open Enterprise is ready to be formed.
If a single individual forms the Open Enterprise, they may dictate the values of the
enterprise.
But without a clear understanding of what values the organization
swears to uphold, eventually there will be conflict that is hard to resolve.
In this scenario, there are 2 likely outcomes: a discussion that yields a set of
shared, agreed upon values to operate by, or it becomes clear the values of the
various individuals don’t fit, and the “ill-fitting” individuals bow-out of the team.
(An unpleasant reality that is much better faced in the beginning than down the
road.)
Creating a company with a healthy triple-bottom-line. That is, one that equally
values people, planet, and profits.
Supporting good causes, particularly those that benefit the environment and
those in need.
Enjoying ourselves as we work is important. We value having fun over winning.
That means having fun amongst ourselves, with our customers, and in our
interactions with the general public.
Work without workers means that there are no employees in the Open Enterprise Model.
There are members. Members do work, of course, but they aren’t “workers” in the
traditional sense. The difference is that employees work for some one else. Employees are
hired, managed, told what to do, and fired when they don’t do it or their employers no
longer have a use for them. Employees don’t own what they work on. Employees are
motivated, more often that not, by a fear of losing a steady paycheck. Ironically, many
employees have a genuine desire to see their companies succeed, but are discouraged by
management from taking the risks required to lead their organizations to greater success.
On the other hand, the members of an Open Enterprise are, in fact, owners. Being clear
about the ownership-nature of an Open Enterprises’ members will help you to more easily
understand the nature of Work Streams, Work Items, and the Contribution-Based Reward
System that is inherently part of such a model.
Who decides who does what Work Item? The person choosing to do it. Think about the
difference of being told what to do vs. deciding and telling others what you will be
responsible for.
What do you think happens to the quality of the work when the work is
forced on some one, versus work that some one has actively chosen to do of their own
Work done voluntarily yields superior results to work done
begrudgingly
Of course, in every business, there is the potential for re-occurring work items to show up.
Suppose we’re talking about a bakery instead of a software development company. Every
day, loaves of bread need to be made and delivered to local grocery stores and restaurants.
In this case, Work Items can be broken down into more-time centric units, and they can be
set to re-occur. For example “Answer Customer Support Phones 3pm to 9pm, weekdays,” or
“Handle Monday Production Orders” could be a task that regenerates every week. A single
member could sign up to take that recurring task. They would know, then, that they were
responsible for making sure all the bakery orders were done and ready by a certain time on
every Monday. If they needed a Monday off, they could give up the shift one week. If they
didn’t want to do Mondays any more, they could give up the recurring task altogether.
Most businesses form in a way that is similar to the above scenario. It often begins with an
idea for a service or product, and grows from there. Interested people get involved and if
they like each other, they agree to form a team to further their goals of creating that
product or service. Here we have our first important distinction between a traditional
organization and the Open Enterprise Model.
Reoccurring Work Items are only different in that they don’t need to be re-evaluated, voted
on, or estimated every week by members. Members know when they are voting on it that
the task will be a repeating one. If members decide it needs to be re-evaluated at some
point, a new recurring task can be created. If passed, the old one can be removed and the
new one can take it’s place.
Essentially, an Open Enterprise has a system for giving credit for each contribution a
member makes. Payment is not “time-and-space-based” like a traditional organization. It’s
contribution-based. The traditional model says “we pay you to be at your desk for 8 hours a
day, 9am to 5pm Monday through Friday.” The fact is, in traditional companies a lot of
people show up and stay their 8 hours without doing much actual work.
In an Open Enterprise, it’s what a person does to actively move the organization towards
it’s goals that rewards them, not how many hours a person sits in their chair twiddling
thumbs. Notice that even in re-occurring tasks, the focus is on the work to be done.
Suppose “Handle Monday Production Orders” means bake the bread and clean the kitchen
when you’re done. If you can do that in 4 hours instead of 6 or 8, more power to you. You
can go home early then, without getting paid less for doing a more efficient job! Of, if you
find another Work Item to do, you can hang around and do it. After all, you’re an owner,
not an employee. Everything you do to make the company stronger, you get rewarded for.
When a task is completed, it must be approved by fellow members before credit is assigned.
That is, if a member develops a logo for the company, the work must receive a certain
number of approval votes before it is considered complete and that member is assign
credits.
the problem of workers not showing up for work or refusing to do a task
they find unpleasant has been practically eliminated. Why? Because no one is told what to
do. If a traditional employee is told they must stay late on Friday to do a store-wide
inventory count, and they don’t want to, they’ll likely show up late, call in sick, or do a
shoddy job because they resent being there instead of at the movies
Contrast this with being an owner of the store. If you own the store and know an inventory
count must be done, you’ll do it because you want your company to be successful. So it is
that members of an Open Enterprise do the occasional unpleasant work items that may turn
up. They aren’t forced to do these things. They choose to do them. They weigh the value of
their actions internally, and decide that even though they’d love to be at the movies, they
would rather have a successful business and the rewards that come with one.
Potential Problems
1. A member fails to truly fulfill an obligation they signed up for. (Not completing a task/doing
a shoddy job—it’s usually a quality issue, not an ‘I didn’t want to do it’ problem.)
2. A member may have performed the task or achieved a particular outcome, but violated one
or more of the driving principles and values of the organization when they did it. (i.e. They
signed up new customers by lying to the customers.)
3. Poor estimation of credit where credit is due. (That is, perhaps someone does 80% of the
work on a particular work item, but another member claims 50% of the credit. Could have
been outright greed, but more often it is a lack of awareness, misperception, and/or a
miscommunication problem.)
That’s what the reputation system is about. If a member acts outside the values of the
organization, it will become obvious on their Reputation board. If the infractions are few and
minor, they will have the feedback they need to change their behavior. Or perhaps they will
decide their values aren’t aligned with the enterprise’s and leave. If the member has gone
too far, a vote can be called for and with a 2/3rds majority passage, the individual will loose
their membership and their right to participate in the organization. (They
The first of these problems listed above (not fulfilling obligations or doing poor quality work)
is likely to be cured by the Quality Control Mechanism described in a previous section of this
document. After all, why do shoddy work when you don’t get paid for it and it ruins your
reputation? However, if that doesn’t curb the behavior, the failure to live up to the
obligations that one freely signed up for is essentially a violation of the values of the
organization. As such, the member is likely to be subject to and excommunication vote and
removed from the Open Enterprise.
Particularly
those of a strongly entrepreneurial nature who are driven to take big risks in search of big
rewards. It may seem that after putting in years of hard work, as the enterprise grows,
one’s efforts and hard work may count for very little when a less experienced majority can
easily out-vote those who have put significantly more time and energy into the
organization....
Users
In the Open Enterprise Model, users are those the
organization serves. They don’t have any particular rights or voting powers within
the enterprise, but their participation and opinions are actively sought.
Contributors
In an Open Enterprise context, a contributor is any user who actively participates
by taking on various work items, but doesn't have binding votes.
Members
This is
because the members are dominant force of activity within an Open Enterprise.
There are two ways to become a member:
1. A contributor earns enough credits. Each open enterprise can set their own mark.
Thus, if the mark is 5,000 credits and a contributor earns 5,000 or more credits,
they are nominated to become a member.
2. Another member in the enterprise nominates a contributor for membership.
Nominated members are voted in by the Core Team (next section)
Once some one achieves membership, membership cannot be taken away except
through the rules of values-based removal of membership from the organization.
Among other things, members can vote on work items to get them done, pass or
fail items that have been completed, and prioritize items, too. They earn credits,
and have the ability to control their proportionate share of funds through the
payment pipeline.
Core Team
Core Team Members are members who have the ability to vote on the big issues.
To become a Core Team Member, a standard member must be voted in by the
existing core team by consensus. The core team serves several functions.
1. Should their be a conflict amongst the general membership of the enterprise, the
core team is there to referee and mediate. They may, if they feel it is necessary,
declare a vote to resolve an issue. They may even cast deciding votes in such
cases. However, philosophically, in these situations the Core Team best serves the
organization by mediating and keeping the dialogue between the members
productive and focused on the values of the enterprise.
2. Only Core Team Members may act as spokespersons for the organization. (Limiting
the number of individuals who formally represent the company is important for
both legal and logistical reasons.)
3. Core Team Members are allowed to vote on adjusting company governance rules.
For example, they may decide that the required 5,000 credit membership mark is
too high or too low, and set a vote to change this.
4. Core Team Members may declare a ‘vote-by-credit’ vote.
Vote-by-Credit Voting
If a Core Team Member feels that an issue is of particular importance, and that the issue
would deeply affect those who have made significant contributions to the organization, they
may request that the issue be resolved through voting-by-credit, as opposed to standard
vote-by-membership voting. Instead of each member receiving one vote, each member
receives one vote per active credit they own. This mechanism means those who have put
the most into the company get more say than those who have made very few or small
contributions to the company.
So how does payment work? Simple: 1 credit = 1 dollar. Rack up as many credits as you
want. When a contributor or member is ready to be paid, they can move a portion or all of
their unpaid credits into the payment pipeline. It’s akin to sending a client an invoice or
submitting a bill for services.
We will cover how money is spent in the organization very shortly. For now, let’s go over a
few more payment details. When a member submits some of their credits for payment, their
credit invoice goes into the payment pipeline. It is paid by a check or electronic payment
out of the Open Enterprise’s bank account. If more than one member submitted a credit
invoice, the members are paid in the order they submitted their payment requests (credit
invoices).
There are, essentially, 4 different aspects to measuring a member’s credits:
1. Total/Historical Credits. This is just that: the total combined number of credits the
member has ever earned. This number only goes up over the lifetime of the member’s
participation, starting from the moment they first invested or contributed to the open
enterprise.
2. Invested Credits. These are the active credits that have yet to be paid. It is, in one form,
money owed to the member by the company. If a member earned 1,000 credits and they
cashed out 600 of those credits, they would now have 400 remaining ‘invested’ credits.
3. Divested Credits. These are credits that have been paid. As explained below, they have an
expiration date. The length of time a credit was invested is the length of time it takes for
the credit to expire once it has been divested. (More below.)
4. Equity Credits. Equity credits are the total number of invested credits plus the total
number of divested credits. Divested credits expire after time, invested credits don’t expire
(unless, of course, they first become divested credits). For now, the important thing to
understand about equity credits is that they can be used for voting purposes when the
enterprise submits a measure to be decided by using vote-by-credit voting. For each equity
credit the member has, they get 1 vote. They are also used to measure a member’s portion
of profit sharing received when enterprise profits are paid out.
Let’s say Bob earns 10,000 credits, for example. That is $10,000 the member has earned.
But until Bob is paid for this, that is money that the Bob has invested in the company on the
faith that they will be paid. (Note: This much is no different than with any conventional
company. Employees do the work first and get paid second. Until they are paid, their labor
is a form of investment in their company, deposited in that company based on the trust that
at the end of the month they’ll be able to withdraw a paycheck in exchange for their labor.)
Given that, the amount of time between the moment a credit is earned and the moment
that credit is cashed out is thought of as the credit’s investment period. Bob earns 10,000
credits. He waits 1 year after earning this 10,000 credits before he decides he wants to cash
out, at which point he submits he submits a payment request. After 1 month, the payment
pipeline is paid out, and Bob gets his $10,000. At that moment, those 10,000 invested
credits become 10,000 divested credits. In this example, the credit investment period for
those 10,000 credits is 13 months. Thus, the expiration date for the divested credits is also
13 months.
This credit investment period is an important concept. That entire year, Bob left his credits
(read: money) invested in the enterprise. That is a risk that Bob didn’t have to take. (If the
company failed, collapsed, or who-knows-what, Bob might have lost that money.) In return,
the enterprise invests equity credits in Bob for a similar period of time.
Bills, The Payment Pipeline, and Profit Sharing
When company money is spent, it can be spent on 3 things: Bills, the Payment Pipeline, and
Profit Sharing. Profit sharing may not be paid until all Bills are paid and the Payment
Pipeline has been paid.
Profit sharing couldn't be simpler. The total number of equity credits owned by member is
tallied up. Then the amount of money set aside for profit sharing is split up according to
what percentage of equity credits each member has. For now, let’s call this percentage of
equity credits a member’s “ownership percentage.” This is an important measurement.
As we understand it,
there is a shift happening in the way organizations operate. It is important to understand
that this shift is not voluntary. It is evolutionary. Those companies and institutions that
adapt will thrive in the new landscape of a highly interconnected yet decentralized world.
Those that don’t will become extinct. Why? The solutions to the problems encountered in
this decentralized, interconnected world will not be solved by a centralized top-down
structure. Period.
In a culture of too many choices, pointless hours are lost trying to decide the perfect course
of action. Forget best. Go for good enough. Learn by doing. The Open Enterprise Model is
based on the principle that no single part will be able to understand the whole. A desire to
understand everything limits an organization to the knowable... it will be stunted much like
a talented actor who can do breathtaking work, yet is typecast to the same old lifeless role
time and again
We have to get past A Need to Understand Everything and Learning By Doing, get past Avoiding Risk and Allowing Healthy Risk Taking and Failure
A paradigm shift is needed
It is easy to conceive that a primitive culture might view an airplane, computer, or digital
camera as the result of "witchcraft" or "magic". With the proper education, it becomes
understood as the technology it is. But a native living in the heart of the Amazon jungle who
stumbles upon a digital camera and takes it apart in an effort to understand or reproduce
it's "supernatural powers" will never succeed in finding the "magic." It requires a paradigm
shift.
The same is true of the Open Enterprise Model. It also requires a paradigm shift. Without
this understanding, you will be looking at the Open Enterprise Model without they eyes to
actually see it. Or worse. You will attempt to establish an Open Enterprise, following the
letter of the law but with no knowledge of the spirit of the law which makes it work.
All the reading and research references we list above ultimately serves one goal: to shift
your perspective about what is possible. So let these closing words sink in. Test your
understanding: if you believe that this model might work in spite of the fact that there is no
central management, think again. You have seen this new idea through the blurred lenses
of an old, dying paradigm. This model will not work in spite of the fact that there is no
central management. It will work because of this fact. It will work because no one is in
charge. Because everyone has a voice and a wide range of opinions and experiences.
Because it is based on values before actions. Not in spite of these things, but because of
these things
Startup Incubation
Crowdsourcing
Commons-Based Intellectual Property
Education 2.0
Gamify Education
Online Learning/Teachers Become Mentors
Stimulate Left & Right Brain Thinking
Personalized Learning
Give Students an Outlet to Practice What They Learn (More Input of Knowledge, Than Output)
Learning About Economics at an Early Age
Cause-Driven New Media
Become Aware of How Powerful Media Is
Independent Outlets Coming Together To Tell A New Story
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