From static, mechanistic machines to dynamic, sustainable, Corporate Collaborative Systems Welcome to 2022, the year when corporate leadership pivots from short term confusion and reactive adaptation to a long-term journey of pre-emptive invention; powered by deliberate disruption. At least, that is the opportunity that is now available. Now is the time to act on changes introduced from the Reframing (Figure 1, Stage 1), that took place during early days of Covid-19. Now is the time to capitalise from new mindsets, to allow uncertainty to give way to determination, to allow adaptation to gradually evolve and inventive, deliberate disruption to thrive. This is not however the year of greater clarity or the start of a new normal. It is a year when long term Restructuring (Stage 2) can commence as reframing gives way to substantive corporate planning, the essential foundation for the journey of transformation and renewal.
Figure 1: Cycle of organisational transformation and renewal
The arrival of Corporate Collaborative Systems
Welcome to 2022, a year of urgency as those that fail to set a redefined trajectory to Corporation 2040 are bound to enter a period of decline and potentially self-destruction – although there is still enough time to get on board to adapt to, and benefit from the transitory forces at play. There is, however, a long journey ahead and the program is arduous, as depicted in Figure 1.
In a forthcoming publication “Corporation of the Future” (Routledge), (1) a group of contributing authors present their depictions of Corporation 2040. As one of the contributors I can attest to the fact that it was difficult to do. The landscape and foundation for assumptions made in the book were changing so rapidly it was near impossible to keep up with the emerging trends. Having said that, a clearer picture of ‘what might be’ did emerge towards the end of our writing as potential trends turned into reality – almost overnight. The prospect of Web 3.0 for example became a concept and then a commitment in no time at all. The end result, some thought, might not be as extensive as that envisaged by Zuckerberg (as the Metaverse, the origin of the new name for Facebook - Meta), but at least there will be blockchain based transaction processing platforms capable of hosting many and huge commercial networks. These networks, it is expected by the authors of one chapter in the book, will be embraced, consumed by, and become the platform for a network of corporate interactions; in a context described as Corporate Collaborative Systems. There will not be any specific design of a Corporate Collaborative System. They will evolve naturally and seamlessly in nonspecific ways. In their operation, intercompany supplier and customer transactions will be enabled via virtual block chain hosted private ledgers. Each transaction will be reliant on predetermined contractual commitments that is exercised on a basis of trust between participating entities. Transaction processing and intercompany movement of goods and services will then be initiated seamlessly and automatically and protected by encrypted providence.
It is unlikely of course that any form of integrated, socially oriented technology of these dimensions will operate effectively without the acceptance and ownership required to embrace everyday use of the technology required to host a multi company form of Corporate Collaborative System. As many have observed and reported in recent times however, barriers to change and resistance to advanced technology were shattered by the sudden and unexpected arrival of the Covid - 19. Although most people shuddered at the thought of the 9 to 5 workday (and associated traffic commutes) for example, this once unbreakable/unwritten law of employment is unlikely to return in the same format ever again. There is still however, a long way to go, the momentum for change is still a trickle rather than a flood. Blockers include the real threat of a lack of governance over the management of the new technologies, a lack of understanding of the potential risk, and a glaring absence of appropriate legislation addressing each. In the development of necessary policies and legislature, debate is still lacking as is societal acceptance as concerns over privacy, control and the invasive nature of technology still needs to be defined, debated, and settled. Examples of the issues to be dealt with are the management of bias in decisions made by Artificial Intelligence, the ownership of risk in the management of remote and robotic operating systems used by autonomous vehicles for example and the extent to which humans will allow machines to control their liberty.
Strategic Aspects of a Corporate Collaborative System
Having reached Stage 3 (Revitalisation, Figure 1) it is likely that Corporation 2040 will have determined which one of potentially three groups of Corporate Collaborative Systems they will chose to participate. They are:
Group 1, a closed collaborative system established by one Corporation on its own. Amazon, Apple, and Google are the most notable of entities already exhibiting features of a Corporate Collaborative System.
Group 2, an open system that anyone can join; a virtual marketplace where virtual complementarity makes collaborations more sensible. An example of existing systems are co-operatives. These are usually formed by primary producers to allow them to optimise – and capture economies of scale from the secondary processing of their produce. Traditionally the domain of remote rural farmers, cooperatives can be formed on a global basis. Instead of dairy farmers combining to manufacture milk, cream and cheese, the collaboration could be extended to incorporate every stakeholder engaged in the growing, processing, packaging, and processing of an entire supply chain that results in the production of chocolate, cheese, milk, cakes, biscuits, bread and much more.
Group 3 will be made up of a variety of hybrid versions of Group 1 or 2 collaborative systems. In one iteration, the most dominant participant (primary member) may instigate the emergence of a group of complementary participants that are voluntarily and/or required by others (at sub-prime level) to join in. This group will evolve exponentially over time; in the same way that ecosystems evolve in nature.
More recently, digital Decentralised Autonomous Organisations (DAO’s) have been forming in a format consistent with this group. A DAO is a form of investor-directed venture capital fund and is defined as “an organisation represented by rules encoded as a transparent computer program, controlled by the organisation members, and not influenced by a central (national) government”(Hackle) (2). The rules of the game, Hackl suggests are embedded in the platforms coding in a format which requires limited human intervention. As a fully automated ‘app’ its administration requires no human supervision, no bureaucracy, and no hierarchy hurdles. Attributes of automation include pre-programmed rules, autonomous functionality, and predetermined/consensual rules. Bit-coin, a crypto currency based on a blockchain platform is an example of a DAO.
Thinking strategically about Corporation 2040
Although considered to be natural, organic ecosystems corporations aren’t great at adapting, but even worse at inventing. This is important to acknowledge because the more mundane tasks that are central to adaptation - corporate operations and its management, will likely be conducted by machines in the future. This will provide humans with the time and energy to focus on values, culture, strategy, and invention. We have already seen this happening with accounting systems which now have automated data collection, analysis and report generation, thereby elevating accountants into a decision advisory role. While the Corporate Collaborative Systems will be devoted to the operation of customer service and collaborative supply chain management for example, it will be the responsibility of humans to manage the portfolio of collaborative systems, and the systems that will enable investors to commit their capital. Humans will be responsible also for the governance of the firm’s investment in those systems and the role they wish to play. This will require considerably elevated skills in strategy practice and new competencies in organisational learning and deep, critical, strategic thinking. Changes that will take place in aspects of strategic thinking will see the emergence of management practices where:
Strategy practice is focused on, and an outcome of organisational learning as opposed to engagement in competitive price wars supported by obsessive cost reduction.
Systems thinking and circularity replaces static planning and ‘end to end’ process management.
Organisational leadership favours collaboration over isolation.
Organisation structuring is dynamic and fluid rather than static and fixed.
Social organising enables systemic, open interactivity over closed, hierarchical bureaucracy, and
Economic empowerment thrives on open networked communities over those of closed, independent, standalone entities.
To realise these practices the corporate culture must reflect a healthy respect for all stakeholder needs where sustainable corporate behaviour in every domain in which it operates is a ticket to play rather than a take it or leave it choice. This is a world of net zero tolerance for environmental waste, greed, discrimination, deception, and adversarial behaviour of any kind. Prime Minister of the UK Boris Johnson is a latent newcomer to this code at his peril as constituents and colleagues alike express their dissatisfaction with the so called Covid-rule breaking Downing Street parties which may see him loose his premiership.
Conclusion
Despite the enormity of change that abounds in our world today the long-term future for corporations is promising – as long as they get their strategy right, commence the journey of transformation soon and maintain a capacity to both adapt and invent strategically focused change. Cultures must be built that embrace openness and circularity and are managed within portfolios of business systems as opposed to Business Units. Summarily any vision of the corporation of the future depicts an entity that is nothing like what it is today. To get to that vision a capacity for continual reframing, dynamic, systems thinking, organisational learning and the invention of ‘green shoot’ (new and emergent) strategy is required.
Even those organisations currently in a state of inertia are in a strong position to succeed into the future as they typically have access to a resource rich foundation, widely recognised brands, ownership of customers hearts and minds and an inherent degree of loyalty. To win the race to the state of Regeneration (Stage 4 - the ideal outcome from the cycle of organisational transformation and renewal illustrated above) however, they must possess a capacity to challenge the status quo, undo embedded negative cultures, continually adapt to ‘what is’ and never stop inventing - and reinventing - what ‘could be’. Transformation though should not be done for the purpose of implementing new technology alone, as is often the case today. Rather it should be seen as an enabler of continual growth and renewal; from its roots as an outcome from the first Industrial Revolution to new realms of unbounded opportunity, on Earth and beyond.
1. Hunter, P., Orr S., Corporation of the Future, Routledge, Singapore, Forthcoming.
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2. Hackl, C., What Are DAOs And Why You Should Pay Attention, Forbes, Jun 1, 2021,08:00am EDT.