Book Review: Exponential Organisations

exponential-organisationsOne of my goals for this year is to average a book a week and share my thoughts on the more interesting ones. Despite my mother’s somewhat malicious suggestion to start with War and Peace I actually kicked off with The Warrior of Rome Series while travelling through Italy. I found Historical Novels a great resource if you are that way inclined.

But here is the first serious book of the year Exponential Organisations by Salim Ismail.

Summary: Lots of good ideas but steeped in an outdated value set of the role of business in society.

The key concepts were grouped into two acronyms of SCALE and IDEAS

Staff on Demand: contractors and casual workers instead of full time employees.
Community & Crowd
: building large online communities around the venture.
: automate everything, the server runs the business.
Leverage Assets
: don’t own things, use other people’s things.
: make user experiences fun and addictive.

Interfaces: simple ways for people to find what they need in the system. 
Dashboards: manage large amounts of data through real time dashboards.
Experimentation: make it cheap and easy try lots of things.
Autonomy: create the space for people to choose their own adventure.
Social Technologies: help people connect with each other.

Coming from folks behind the Singularity University it had a good overview exponential growth, particularly how unintuitive it is for people to grasp. Despite being quite predictable it always seems to take us by surprise.

LakeMichigan-Final3Source: Mother Jones

I often evaluate books by the ‘how many ideas do I want to copy’ metric and Exponential Organisations had a reasonable amount of this. It was first recommended to me because of the amount of case studies and  whether it was reading about TED scaled to 12,000 events over 5 years or how Github became the backbone of the open source community there were lots of useful nuggets.

Despite that I found the overall language of the book quite toxic and embedded deeply in the business mentality of ‘if it is big and makes money it must be good’. Ugh. I think the heart of my distaste was that a lot of the strategies had the explicit intent of externalising costs from a business onto society and a lot of the case studies celebrated companies which had done that well.

For example, in the Staff on Demand section a case study was given on how Allstate (insurance) ran a competition on Kaggle with a prize of $10,000 to rewrite their claims algorithm. The winning entry had a 271 percent improvement which was estimated to save the company tens of millions annually. “Quite an interesting ROI” as the author put it.

Kaggle describe themselves as “harnessing the ‘cognitive surplus’ of the worlds best data scientists” which makes me wonder who is paying for generating that cognitive surplus if Kaggle’s customers aren’t. Whether it was Uber or Airbnb, time and time again the book highlighted companies which had grown very fast and made their shareholders very wealthy by externalising costs onto society and clipping the ticket on virtual marketplaces.

The case studies were biased towards a ‘growth is good’ mentality whether the thing growing was cancerous or beneficial. I guess that is fair enough given the topic of exponential growth but I would love to have seen more discussion on the consequences and downsides of these types of organisations.

I suspect the authors would say they are explaining a phenomenon that is morally neutral and can be used for many purposes. That this is a book on the techniques of sword fighting, not the morality of warfare. But just like sword fighting will lead in a certain direction I think a fair number techniques in this book lead to companies which steal value from society rather than create true value.

Despite that there are lots of practices which are just plain better and useful for anyone who is interested in making an impact. The book clearly describes a new breed of organisation which is pretty important to understand.


Book Review: Exponential Organisations

Mastermind: setting strategy together

One of the processes we have been playing with at Enspiral is how we set our collective strategy. A team of us ran the first Mastermind process to come up with our 2014 Enspiral strategy and we are just winding up our one for 2015. Teams within Enspiral are also picking up and adapting the process which is often a sign there is something in the idea.

Mastermind, set strategy together.Image by Maz Hermon

I initially had a strong aversion to setting a formal strategy for the network, it seemed much more important to focus on our culture and let the direction emerge naturally from people’s actions. However, I’ve found that the process can be a strong culture building initiative in its own right and having a formal strategy gives people context when they are making decisions in Loomio and Cobudget.

I came to the conclusion that it is important to hold the strategy lightly and realise it is just a snapshot of the network’s intentions, but it’s better to have a snapshot than nothing.

The top level process is pretty straight forward.

  1. Gather as much high level information as you can and consolidate into a digestible format to share with the whole group.
  2. Focus on divergent thinking through individual and group processes to build up a list of possible strategic directions.
  3. Look for common themes and build a consolidated list of possibilities, use dot voting to prioritise the most important.
  4. Have a small group use this information to create a proposed strategy and run through a normal Loomio decision making process to finalise it.

Gather Information > Divergent Thinking > Convergent Thinking  > Summary & Approval

This has lots of elements I like such as

  • An iterative nature to give ideas time to develop
  • A balance between whole group, small group and individual activities
  • A balance between creativity and focus

But I also see it as just a baseline and that the true power of the process lies in future iterations. For example, at Dev Academy we are experimenting with a two step approach of

Individual Mastermind:  each team member is invited to think about their personal strategy and direction for the year.
Regular Mastermind:  we collectively think about the team as a whole with the additional context of  each person’s strategy and intentions.

I really like this adaptation as it doubles down on culture building and also builds a stronger personal reflection process. Personally, I found it really useful to sit down and think about where I should be heading and how best to communicate that with others. It was that process which led me to start blogging again.

I can imagine a truly fractal process where each team at Enspiral has a clearly articulated strategy which can provide context for our whole of network thinking. By having a similar name and process at different scales of organising we reduce the cognitive load for participants and we can also reduce the transaction costs for engaging by automating the information systems.

It also evokes the possibility of truly living strategies that respond to change in real time. At the moment a full network strategy is quite expensive in terms of engagement. Would it be possible to design processes so that the strategy evolved through lots of small alterations as the context changed? Could we build a strategy that is a real time reflection of our collective intent that mirrors a traditional swarm?

Currently we orient ourselves with information from other people’s actions and crude, somewhat outdated snapshots of our collective intent. That’s analogous to swallows bumping into each other to correct their individual paths using images their eyes collected 2 hours ago. What if instead we could orient ourselves based off the accurate, explicit intent of individuals and teams of all different sizes?

If we make forming, updating and sharing our strategic direction cheap enough and ubiquitous in an organisation I think we could unlock elegance that would make the swallows envious.

Here are some of the documents I’m working with if anyone feels like hacking on the process and I’d love to hear of any similar work going on.

My personal strategy
Individual Mastermind Template
Review of 2014 Mastermind Process


Mastermind: setting strategy together