Business leaders are engaging labor differently - Is your IT ready?
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Business leaders are engaging labor differently –Is your IT ready?
InnoTech – Oklahoma CityNovember 1, 2016
Doug ReederCTO Commercial Industries, Dell Services
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Technology does not cause change.
It only enables, facilitates, and accelerates the changes we
want to take place.
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Innovation
Business
Models
Management
Products and
ServicesProcesses
Marketing
New ideas + Forward-thinking + Feasible + Viable + Valuable
Implementing new ideas that create value.
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Innovation is not invention
Invention is the process of taking capital and turning it into knowledge.
Innovation is the process of taking knowledge and turning it back into capital.
Implementing new ideas that create value.
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Who Wants What from IT?The market expects:• Value• Flexibility• Adaptability• Speed
CEONo capital expenditures
Linear or decreasing operational expenditures
Time to Market
CIOLegacy extension
Information:• Assurance & security• Governance & compliance
Integration & Innovation
CFOOn demand
Metered
Natural Billing Units
End UserAny data
Any where
Any time
Any device
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Architecture for Systemic InnovationInsight
Market Innovation Customer Engagement
Scan R&D, IP & Patents, Regulations & Standards
Identify Constraints & Opportunities
Environmental Scanning Weak Signals & Trends
Foresight
Develop Themes& Scenarios
Plan of Record
Plan of Intent
Plan of Investigation
StrategicPlans
Frameworks
ReferenceArchitectures
Operational& Annual
Plans
Solve Business Challenges
Facilitate Shared & Open Innovation
Specific Innovation Plans
Outcomes and Metrics
Invest Execute
Collaborative Culture
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Approaches & tools
• Environmental Scanning
• Futures Wheels
• Futures Cone
• Scenarios
• Black Swan Analysis
• SWOT
• Extrapolation
• Surveys
• Regulatory Reviews
• Expert Panels
• Delphi
• Backcasting
• Patent Analysis
• Science Fiction
• Many others
Strategic Foresight
The objective of foresight is to identify future needs, challenges, opportunities, scenarios, and potential solutions.
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Foresight – Looking outside and anticipating changeSTEEPLD Framework
SL T
EEconomic forces & signalsE
Political forces & signals
Technological forces & signals
Environmentalforces & signals
Societal forces & signals
Legislativeforces & signals
Economic – growth, finance rates, investment, employment, elasticity, productivity, etc.
Political –trade rules, competitive rules, stability, openness, freedom, etc.
Technological –examined in terms of its usage patterns, potentials and possibilities. Actual technology forecasts are handled in Insight
Societal –risk tolerance, familial ties, mobility, lifestyle, priorities, attitudes, etc.
Legislative –employment rules, contracts, consumer protection, corporate governance, etc.
Environmental –customer expectations, carbon, infrastructure, etc.
PD
Demographics -cohorts, generations, frameworks, tribes
Demo-graphics
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Augmented and virtual reality*
Crowdfunding & Peer-to-Peer lending
Reputation economy
Internet of Things
Sustainability* Advanced genomics*
Quantified Self*
Cryptocurrencies& Blockchain*
Circular economy*
Advanced robotics*
Utility computing
An old workforce,a new workforce
*See photo credits on attributions slide
Sample signals, trends, and enabling technologies
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Open innovation & Crowdsourcing
Sample signals, trends, and enabling technologies
Dynamic pricing Consumerization
UrbanizationPerfect Information
Freelance economy & Hollywood Model
Sharing economy
Local Manufacturing; 3D and 4D printing*
Learning styles & knowledge transfer
Pervasivesimplification
Smart everything*Gamification
*See photo credits on attributions slide
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Primary research
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Source: Accelerating Value: Mega Trends Impacting Business Today; A Joint Study by Dell & Forbes Insights
75%of C-Suite executives want their CIO to play an active advisory role in setting business strategy
Research Insights
28% Think their CIO is performing better than their peers
Source: Innovation from Efficiency: Unlocking the Value in IT Systems; A joint study by Dell & Harvard Business Review
46%Believe the CIO does not understand business strategy
Source: The C-suite Challenges IT: New Expectations for Business Value: A joint study by Dell & The Economist Intelligence Unit
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Management Innovation Exchange (MIX)
www.managementexchange.com
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Serve peers and customers –not the boss
Break up monolithic structures
Give everyone a place at the table
Radically expand the scope of employee autonomy
Provide open access to real-time information
Ditch formality
Create meritocracies where influence is based on contribution, not credentials
Drive performance through a shared sense of purpose and community
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The CEO Perspective:
The purpose of the 20th century firm:
The purpose of the 21st century firm:
To minimize transaction costs and achieve scalable efficiency
To accelerate capability building and effectively apply that capability to innovation
Creating new value —better & faster
New view: Socially-enabled enterprise operating in a digital business ecosystem
IT is essential to enabling firms to evolve and innovate with information driven value creation
Systems of Record Systems of Engagement Systems of Insight
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Planning & directing
Preparing & mentoring
From:
To:
Staffing & controlling
Engaging & framing
Hierarchical & authoritative
Broad relationships
& crowd-sourcing
Creativity and knowledge
Industrial approachFocus on repetition, scale and efficiency
Focus on originality, innovation and efficacy2.0
En
terp
rise
Management 2.0
Economics 2.0
IT 2.0
Capitalism 2.0
Future of the enterprise
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Digitized business ecosystems
Who can add value to mine, how can I add value to theirs?2.0
En
terp
rise
Management 2.0
Economics 2.0
IT 2.0
Capitalism 2.0
Universal access, availability and on demand performance; within and without the corporate boundaries; from customer through supply chain; recursively.
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Effective socially-enabled enterprise
Two-way collaboration between publishers and consumers of content, knowledge and value
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Changed nature of value
Value will be the product of in-the-moment, at-the-place collaborative creation
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Strong partnerships and relationships
Even among competitors, in order to service customer
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Smaller, more agile enterprises
An ecosystem to speed up the processes of successful selection
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Complex information systems
Lots of moving parts, known and unknown factors, with varying degrees of understanding
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Evolution of the workforce
Mentoring people versus directing people on how to achieve outcomes
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What’s changing?
BYODBring Your Own Device
BYOABring Your Own Application
BYOIBring Your Own Infrastructure
BYOPBring Your Own Process
SYOGSet Your Own Goals
DYOJDesign Your Own Job
CYOS Crowdsource Your Own Solution
AYOEApprove Your Own Expenses
DYOVDetermine Your Own Vacation
CYOBChoose Your Own Boss
Partially adapted from: The Dawn of Distributed Leadership by Gary Hamel, June 24, 2014
http://www.mixhackathon.org/hackathon/contribution/dawn-distributed-leadership
PYOCPick Your Own Colleagues
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What motivates us?
Autonomy
• Desire to be self-directed
• Management is great for compliance, but not engagement
Mastery
• Urge to get better at stuff
Purpose
• More than profits – Making the world a better place
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Innovation
Business
Models
Management
Products and
ServicesProcesses
Marketing
New ideas + Forward-thinking + Feasible + Viable + Valuable
Implementing new ideas that create value.
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Management Innovation
Examples
Management innovation refers to the way organizations engage
resources to enhance performance and achieve superior outcomes.
Labor Resource Models
Reward structures
Organizational models
Organizational ModelsAdvanced Collaboration
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Management Innovation
New view of the enterprise: Socially-enabled enterprise operating in a digitized business ecosystem
Experimentation with new approaches to labor beyond staff augmentation and traditional outsourcing:
Management
Advanced Collaboration
• Hackathons
• Crowdsourcing
• Hollywood Model
• Microwork
Organizational Models
• Flat organizations
• Holacracy
• Expert Ecosystems
• Networked Organizations
• Transparent Organizations
Resource & Work styles
• Alternative Labor Models
• Partial/Fractal Teams
• Open Allocation of Time
• Self-Selection/Autonomy
• Internal Mobility
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Alternatives to full-time employees in specific roles
Traditional Full-Time
Employees
Interns
Contingent Workers
Independent contractors
Crowd-sourcing
Microwork
Open Allocation
Teams & Clusters
Dynamic Bench
Alumni & Ramp-down
workers
Outsource Personnel
Fractal
CXOs
Reputation economy
Open innovation & Crowdsourcing
Freelance economy & Hollywood Model
Sharing economy
Learning styles & knowledge transfer
An old workforce,a new workforce
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Hackathons
A gathering of experts, traditionally programmers, that collaboratively develop work products in a compressed time frame.
Hackathons, or “Hack Day”, “Hackfest” or “Codefests” originated with Computer Programming (1999) later extended into other areas including:
• Process
• Management
• Marketing
• Strategy
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Freelance Economy & the Hollywood Model
Hollywood ModelOnly the “producer” remains with the project from start to finish. Others come and go as skills are required.
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Freelance Economy & Hollywood Model
“A freelance economy revolves around hiring self-employed workers to undertake specific, short-term jobs in return for an agreed upon wage. These jobs typically are too small or infrequent to hire a full time employee or would be too expensive to contract out to another firm.” 1
Hollywood Model – “A project is identified; a team is assembled; it works together for precisely as long as is needed to complete the task; then the team disbands. This short-term, project-based business structure is an alternative to the corporate model, in which capital is spent up front to build a business, which then hires workers for long-term, open-ended jobs that can last for years, even a lifetime.” 2
Freelance economy & Hollywood Model
1 http://www.investopedia.com/terms/f/freelance-economy.asp2 http://www.nytimes.com/2015/05/10/magazine/what-hollywood-can-teach-us-about-the-future-of-work.html?_r=0
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Hollywood Business Model – Impact on IT
The Hollywood Model embraces economic specialization; Focus on where you can create value and outsource everything else.
Less of this: More of this:
Internal IT budget External IT budget
Built and managed here Bought and managed there
Cost of labor Value of talent
Ownership Lease
Physical management Virtual access
People Software
Generalists Specialists
Independence Interdependence
Market leader Leading consortia
IT Departments:Shift from Cost Center to Value Creator• Costs are quarantined and
made variable• Scale and expertise is
available and responsive• Costs are correlated to
revenues
Freelance economy & Hollywood Model
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Hollywood Model - Enabling Technologies
Virtual Desktops, in all their forms and BYOx enablement:
• Server-hosted Virtual Desktop Infrastructure (VDI)
• Desktops-as-a-Service (DaaS)
• Remote PC access/Remote desktop services/Session-based DT (Win Server 2012)
• Local virtual desktops – Bare metal (Type 1), and Type 2
• Application virtualization
• Unified Endpoint Management
Security
• Robust network security
• Digital Rights Management
• Identity Management; ID-as-a-Service (IDaaS)
• Two Factor Authentication (2FA)
Freelance economy & Hollywood Model
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Hollywood Model - Enabling Technologies
Knowledge Management
• Advanced KM tools and readily searchable achieves
• Project management tools
• Knowledge sharing tools
• Collaboration tools
Cynefin Decision-Making Framework
Freelance economy & Hollywood Model
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IT facilitation of alternative labor resource models
Address foundational requirements
• Identity Management: robust and agile
• Network security
• Security for intellectual property; Digital Rights Management
• Base collaboration tools
Establish a socially-enabled enterprise
• Portfolio of IT tools to enable new human resource approaches:
• Internal crowdsourcing and external solver groups
• Advanced Knowledge Management tools
• Identify and expand Virtual Hosted Desktop solutions
Enable a full digital business ecosystem
• Develop journey maps, identify alternative labor opportunities within them
• Partner with business units to further enable a permeable, flexible, dynamic workforce, including federation with suppliers and customers
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“Most of the bright people don't work for you -no matter who you are.”
Bill Joy, Sun Microsystems
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How crowdsourcing works
Company & community profits
Company rewards winning solvers
The crowd & company vet solutions jointly
The online “crowd” submits solutions
Company broadcasts the problem online
Company has a problem
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Types of Crowdsourcing• Searches
– Specific ideas, wisdom, data, lost & found items
• Creative projects– Graphic design
– Brainstorming for unconstrained ideas
– Refinement of ideas
• Challenges – Structured questions to create a deliverable
• Project work– Open source and competitive source
– Microwork
• Funding– Venture capital from individuals
• Crowdvoting
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Crowdsourcing industry
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Local Motors™ - Crowdsourcing and Personalization
“This design has aroused incredible feedback and collaboration from the Community. By promoting discussion and collaboration early on, we are able to design cars we know people want; there is no guessing.”
Ben Messmer, Lead Designer at Local Motors explains the value in Community Design Process.
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The best run challengesproduce only a few
viable solutions
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Precisely define challenges
“If I had an hour to solve a problem I'd spend 55 minutes thinking about the problem and 5 minutes thinking about solutions.”
- Albert Einstein
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Crowdsourcing Recommendations
• Focus on very narrowly defined challenges– Challenge abstraction and definition is key
– Train a catalyst solver group to help ensure only viable solutions are submitted
• Understand the available tools and how they can be used– Internal tool for employees
– External tool/service when internal solutions cannot be discovered
• Issue a balanced portfolio of challenges– Not all challenges have to be grand challenges
• Governance, balanced with autonomy, is essential– Follow through on viable solutions (or risk alienating your solver group)
• Partner with HR and/or whoever owns culture in the organization– Use as a catalyst to build or enhance a culture of innovation
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Microwork
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New resource models & approaches: Microwork
The process and execution of decomposing work projects into smaller, manageable modules and engaging workers, typically from a network of people with skills and resources, to accomplish the task.
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Amazon’s Mechanical Turk
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The Mechanical Turk (1770-1854)
By Wolfgang von Kempelen - Copper engraving from the book: Freiherr Joseph Friedrich zu Racknitz, Ueber den Schachspielerdes Herrn von Kempelen, Leipzig und Dresden 1789., Public Domain, https://commons.wikimedia.org/w/index.php?curid=424090
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New resource models & approaches: Microwork
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Open Allocation of Time
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Self-organizing models; Open Allocation
Open allocation refers to a management style in which employees are given a high degree of freedom in choosing what projects to work on, and how to allocate their time. They do not necessarily answer to a single manager, but to the company and their peers.
Organization Industry Type Number of employees Used open allocation
W. L. Gore and Associates
Manufacturing Private company 9,840 1958 (founding year) - date
Valve Corporation Video games Private company 400 Founding year – date
Treehouse Technology Private company 60 June 20, 2013 – date
Monk Development Software as a Service Private company 25-30 2013 – date
GitHub Technology Private company 175 Founding year – 2014
20%
FedEx Days
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Open allocation - W. L. Gore & Associates, Inc.
Bill Gore articulated four culture principles that he called freedom, fairness, commitment and waterline:
• Associates have the freedom to encourage, help, and allow other associates to grow in knowledge, skill, and scope of responsibility
• Associates should demonstrate fairness to each other and everyone with whom they come in contact
• Associates are provided the ability to make one's own commitments and are expected to keep them
• A waterline situation involves consultation with other associates before undertaking actions that could impact the reputation or profitability of the company and otherwise "sink the ship."
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Organizational and Management Models
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Statoil: Self-regulating management model
Profile:• Norwegian oil and gas company• Operations in 34 countries, 20,000 employees and $90B revenue• Ranked #67 on Fortune 500 in size, but #1 in Social Responsibility and #7 in Innovation
Management Innovation Exchange: Busting Bureaucracy Hackathon
• Reinvent the means of control• Develop holistic performance measures• Stretch management timeframes and perspectives
Key Initiatives towards a “more dynamic, flexible and self-regulating management model.”
• “In 2005 we started on a journey of radically changing our management processes, which included abolishing traditional budgeting.”
• “In 2010 we decided to ‘kick out the calendar’”
www.managementexchange.com
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Self-regulating, Self-management models
History:• The Morning Star Company was founded in 1970 by Chris Rufer
as a one truck owner operator, hauling tomatoes to other canneries • Today, Morning Star accounts for over 25% of the California
processing tomato production, supplying 40% of the U.S. ingredient tomato paste and diced tomato markets, with industrial sales of approximately $350 million
Key Initiatives towards a self-regulating, self-management model:• People (“professionals”) work in a culture of self-management to
achieve the mission• They initiate communication and coordination of their activities
with fellow colleagues, customers, suppliers and fellow industry participants, absent directives from others
• Colleagues take personal responsibility and hold themselves accountable
…no bosses, no titles, no job descriptions, and a sweeping scope of authority when it comes to making decisions (about hiring, how to spend the company’s money, what direction to take)
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New Management Models: Holacracy
Management Without ManagersHolacracy places the seat of organizational power in an explicit process, one which organizes around an explicit purpose. This allows emergent behavior of the whole system, without being controlled by either a single heroic leader or even the collective group.
Holacracy is a self-governing, purpose-driven business structure that reassigns authority and responsibility based on the task at hand.
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New Management Models: Holacracy
Holacracy is a self-governing, purpose-driven business structure that reassigns authority and responsibility based on the task at hand.
Medium is an online social journalism platform
Founded by Twitter co-founder Evan Williams in 2012.
Publications include:
Cuepoint – Online Music Magazine
Backchannel – Technology publication
Zappos.com is an online shoe company and is part of Amazon.com
ARCA, a North Carolina-based technology company
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• liv.it• Concept7 (case report)• talkSpirit (case report)• ARCA (blog post)• Netcentric (blog post)• Buddhist Geeks (note)• Office of the Chief Information Officer of Washington
State (blog, links, public governance records)• OZ• Voys (links)• cidpartners GmbH• Colman Knight Advisory (link)• Scarabee Biocoop (report)• energized.org (public governance records)• soulbottles• CourageLabs LLC (public governance records)• MankindProject USA (public governance records)• Xpreneurs GmbH (public governance records)• ACNV-BF (public governance records)• Die Wertschätzer• Doctusoft• FinanceFox• EMPAUA• SocialSquare (blogpost)• Findasense (video)• AFCA• LIIP• Euforia• CINTEO• VSE• People’s Playground
• HolacracyOne (public governance records)• iGi Partners (public governance records)• Structure & Process (public governance records)• Evolving Organisation (public governance records)• Zappos.com (link collection)• Downtown Project• David Allen Company (link collection)• Undercurrent (Case-Study)• Future Logic (press release, Stephan Jenner on Quora)• AdScale Laboratories (case-study)• Wonderworks Consulting• Springest (announcement, blogpost, more details)• BoP Innovation Center• Impact Hub Amsterdam• Impact Hub Vienna (article)• Impact Hub Company• Waterschap de Dommel (in parts of the organisation)• Streamit (in parts of the organisation)• Center for Human Emergence• CHE Synnervate• Kolibri• The Integral Center• Conscious Brands• Outformations Agile Collaboratory (governance)• Three Coins (mention)• Trillium Awakening Operations Circle (public governance)• Washington’s Strengthening Families Collective (via)• Becoming Parents Program (via)• BC3—Boulder Conscious Community (Governance)• Precision Nutrition (video, case-study)• Beratergruppe Neuwaldegg• Moveline• ITX Wireless (note)
Known organizations using Holacracy as of 03/24/2016:
Source: http://structureprocess.com/holacracy-cases/ Extracted April 2, 2016
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• Trillium Awakening Operations Circle (public governance)
• Washington’s Strengthening Families Collective (via)
• Becoming Parents Program (via)• BC3—Boulder Conscious
Community (Governance)• Precision Nutrition (video, case-study)• Beratergruppe Neuwaldegg• Moveline• ITX Wireless (note)• liv.it• Concept7 (case report)• talkSpirit (case report)• ARCA (blog post)• Netcentric (blog post)• Buddhist Geeks (note)• Washington Technology Solutions
(WaTech) (blog, links, public governance records)
• OZ• Voys (links)• cidpartners GmbH• Colman Knight Advisory (link)• Scarabee Biocoop (report)• Energized.org (public governance records)• soulbottles• CourageLabs LLC (public governance
records)• MankindProject USA (public governance
records)
• HolacracyOne (public governance records)• iGi Partners (public governance records)• Structure & Process (public governance
records)• Evolving Organisation (public governance
records)• Zappos.com (link collection)• Downtown Project• David Allen Company (link collection)• Undercurrent (Case-Study)• Future Logic (press release, Stephan Jenner
on Quora)• AdScale Laboratories (case-study)• Wonderworks Consulting• Springest (announcement, blogpost, more
details)• BoP Innovation Center• Impact Hub Amsterdam• Impact Hub Vienna (article)• Impact Hub Company• Waterschap de Dommel (in parts of the
organisation)• Streamit (in parts of the organisation)• Center for Human Emergence• CHE Synnervate• Kolibri• The Integral Center• Conscious Brands• Outformations Agile
Collaboratory (governance)• Three Coins (mention)
Known organizations using Holacracy as of 09/12/2016:
Source: http://structureprocess.com/holacracy-cases/ Extracted October 10, 2016
• Xpreneurs GmbH (public governance records)• ACNV-BF (public governance records)• Die Wertschätzer• Doctusoft• FinanceFox• EMPAUA• SocialSquare (blogpost)• Findasense (video)• AFCA• LIIP• Euforia• CINTEO• VSE• People’s Playground• Lab.Coop (blogpost)• bol.com (in some teams)• Spindle• Purely Poultry• encode.org• evolution at work• Business School Lausanne• dwarfs&Giants• CompassPoint (blogpost)• Valsplat (post)• Viisi (public governance records)• Green-Acres• Connectis• Butterfly Works• Rockstart• Smart Hotel• PRO6 Managers (more details)• Durabilis
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Distributed and network workforce approaches
Expert ecosystems Networked organization
Technology firm in Venezuela
• Work is arranged in large outcomes
• Teams are formed and self-selected
• Highly transparent• People backfill their own
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Emerging Models; Open Supply Chain
SFI: Self Adaptive Supply Chains
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Open Innovation
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Open innovation & Crowdsourcing
Open InnovationOpen innovation is: “a business concept developed by Henry Chesbrough which encourages companies to acquire outside sources of innovation to order to improve product lines and shorten the time required to bring products to market, and to market or release internally developed innovation which does not fit the company's business model but could be effectively used elsewhere.” *
* http://www.businessdictionary.com/definition/open-innovation.html
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WIP: It is all aboutECOSYSTEMS
Key Challenge:
• Security and Privacy Concerns
• Lack of Standards
• Investment
• Trust
Key Opportunity:
• Adaptability Agility
• Serendipity
• New Capabilities
• Transparency
Government
Society
Environment
The Future
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Recommendations
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Key ideas to build on
• IT needs to take a leadership role in introducing and facilitating new ways of working
– Understanding trends, signals and directions, and being prepared with the right tools to ensure productive contractors, dynamic workers, and new office environments
• Understand that technology is not the primary driver of change
• Innovation is not invention, and is far more than products, services and gadgets
– Enabling and facilitating business model changes, understand business models
• Management models are being disrupted– Business leaders need IT’s help to accelerate the transformation
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Recommendations - CIOs and Strategic IT Leaders
• Establish a Strategic Foresight function in your organization, and/or liaisons to existing corporate groups
– Use a STEEPLD-type framework for Foresight
– Expand the role of ”Technology Scouts” to include business signals & trends
• IT leaders should partner with business leaders to develop a culture of innovation
– Identify who “owns culture” in the their organization, often Human Resource leaders and Chief Customer Officers
– Seek to promote serendipity in the workplace
• If Open Allocation of employees time is not already embraced by the organization, find the curious employees and have them periodically report what they are seeing
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Foundational viewsScience Fiction suggestions include:• Twelve Tomorrows (2016) by MIT Technology Review• The City of the Future (2016) Presented by Sci-Futures• Aurora (2015) by Kim Stanley Robinson
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THANK YOU
@DougReeder
Business Innovation in the Cloud by Jim Stikeleather and Peter Fingar
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Appendix
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Photo attributions
Quantified self: ”Quantified Self 2011” by Bytemarks is licensed under CC BY 2.0
Circular economy: “Go Circular!” by Zeronaut.be is licensed under CC BY 2.0
Advanced robotics: “OpenSource Robotic Arm” by oomlout is licensed under CC BY 2.0
Cryptocurrencies & Blockchain: “Image_2374” by BTC Keychain is licensed under CC BY 2.0
Sustainability: “Sustainability” by Kyle MacKenzie is licensed under CC BY 2.0
3D and 4D Printing: “MakerBot_ReplicatorZ18_ProdBild3” by Creative Tools is licensed under CC BY 2.0
Learning Styles: “babies at the blackboard” by Audio-luci-store-it is licensed under CC BY 2.0
Advanced Genomics: "Miraikan” by MIKI Yoshihito is licensed under CC BY 2.0
Augmented & Virtual Reality: “Google Glass” by Matt Brown is licensed under CC BY 2.0
Samsung Smartwatch: “Samsung Galaxy Gear smartwatch” by Kārlis Dambrāns is licensed under CC BY 2.0
Oculus Rift: “Maxim Kapinus and Oculus Rift” by Sergey Galyonkin is licensed under CC BY-SA 2.0
Dell – Internal Use - Confidential