Leave your thoughts here. (23 responses)

1. 1 Ryan Geist Jul 17th, 2007 at 6:50 pm

   Ryan,

   Great post! This is a really on-target observation.

   Technology is clearly a driving force in Gen Y’s ability to advance decentralization in modern organizations, but there’s something even more significant than technology that is advancing this trend. It is the most important product of the Internet and the greatest asset of the Next Generation. It is the reason that businesses must decentralize, or risk complete failure. It is shifting the balance of power in the workplace. It is: Knowledge.

   Traditionally, institutions have been the gatekeepers of knowledge, and have leveraged that position in a powerful way. Think about the way institutions typically relate to employees: the lower you are on the totem pole, the less information they feel you need to know (and you, my friend, are on a need to know basis). Consequently, lower-level employees have significantly less influence on the development and direction of the organization. Traditional institutions hold back knowledge in order to retain their power. Not such a good idea, nowadays…

   Enter Wikipedia: “proprietary knowledge�? becomes the brunt of discussion board jokes. In today’s world, there exists an inverse correlation between age and one’s efficiency of acquiring knowledge. The implications of this are huge. Now, the master of the Internet is the keeper of the knowledge. For companies to keep their competitive edge, they will need to solicit knowledge from the lowest rungs of their employees. This gives entry-level employees an unprecedented amount of power, and is the reason that the United States will witness an inevitable trend to decentralized organizations.

2. 2 Allan Wallace Jul 18th, 2007 at 2:27 am

   Ryan,

   Good points, you are right - the world is changing.

   Only two corrections.

   Wikipedia does control and delete terms, I put the term “Netcohort” on its own page and it was removed within a week. The Wikipedia monitor that removed it claimed it did not have enough history.

   However the Netcohort does exist and it is not just Gen-Y. The Netcohort is centered in relationships and reputation.

   Decentralized organizations will be small and nimble, the old Too Big organizations will implode. The world was once filled with centralized, hierarchical structures - they are diminishing with the industrial age that spawned them.

3. 3 Ryan Healy Jul 18th, 2007 at 8:07 am

   Allan - Good point about Wikipedia having some control, and honestly a little bit of control is probably neccesary. Decentralized organizations are beginning to take over, but Im not sure that these old “too big” organizations are diminishing. Like you say, the industrial age is long gone, but things in the office seem to work strangely the same way…

   Ryan G - Bingo, knowledge is king and the internet has allowed young people to learn a lot more at a young age. I’m not sure about the power thing yet, but with any luck your prediction will come true.

   Recruiting Animal - You need to find some new material.

   -Ryan

4. 4 Ryan Jul 18th, 2007 at 10:57 am

   Generation X, Generation Y, Generation ABDCD?!?!?! Who decides these stero-types anyway? The worlds is always in constant change, but don’t kid yourself and think just because you are some self proclaimed 23 year old wiz kid, that your the only one that has it figured out. And the fact that you think you should be given special treatment and that corporate
   America needs to, “watch out” is really absurd and arrogant. Sure, information is flowing and things are changing, but if you think that the busniness world is just going to fold and start handing inexperienced, newly graduated employees a corner office (or telecommuting privelages) and real decision making power, you are up in the night. I’m 33 and we have hired several new college grads in our office. I can tell you right now, the ones that are successfull and stick around (and are rewarded) are still the ones that come in, work hard, pay their dues, and work through the system. The one’s that carry the arrogant “Gen Y” mentallity, fail miserably. So take if for what it’s worth from someone inside corporate America - don’t take to many liberties when it comes to “Gen Y” or you might just become “Gen unemployed.”

   Ryan - props to you for finding a way to make money on the Gen Y hype. That’s true capatilism!

5. 5 Fred in IT Jul 18th, 2007 at 11:19 am

   I agree that it’s the technology that is enabling a flattening of the Industrial Revolution mindset in corporate control. I don’t agree that it is the exclusively the hallmark of Gen-Y that is doing it. Or even created it.

   I like the example of build a product and a business plan in a day w/ 70 odd folks gathering at a bike shop. Reminds me of the communes of the 60’s. The problem is a matter of scale. Current technology does allow you to scale better than in previous situations. But the information overload of the network will eventually overwhelm and swamp the decision making capacity of the core organization. Which, will still have to follow the model you think is doomed to fail. Someone has to have the deciding vote. Someone needs to reach out, do the initial organization, form consensus, gather the troops, heard the cats. In short, make a decision. Linux / OSS is a prime example of this.

   There is also the problem of sustainability. The longer an organization exists, the more institutional knowledge it builds up. Beyond the legal requirements of maintaining much of this information, much of it requires some sort of centralized mechanism to maintain it. Also, what do you do if one of your critical teams decides to jump ship? How do you get new people to the fold up to speed? Take a look at the Mythical Man Month by Fred Brooks - he has some good insights into this problem.

   The decentralized model you are talking about, so far, only seems concerned with geographic centralization. With advanced technology, centralized work locations for many roles and function have become moot. The Gen-Y’ers didn’t invent this, they are just taking advantage of a situation that exists.

   And so far, with Wikipedia, Facebook, etc. you are only discussing the lower-rung worker bee’s. Not the corporate structure as a whole. All of the organizations you mention still, at their core, have the old corporate system in place. Communication may be more faster, more fluid, with decisions being made lower down the rungs. But that’s just the hallmark of a well-run company. Nothing special here.

   However, I would not want to walk in a building, drive a car, fly in a plane, visit a hospital, go over a bridge, live next to a Nuclear power plant/oil refinery, take a drug etc. that was built using this model. It’s not all bureaucratic red-tape. There is quite a bit, but there is also much of it is there to prevent people from doing stupid, arrogant, greedy or malicious things.

   By the way, the term you are referring to is called: Disintermediation of Information. It was first developed in the late 60’s… hurm right during that commune thing. Coincidence?

6. 6 Paul V Jul 18th, 2007 at 1:10 pm

   As for Facebook’s revoultionary new concept, there’s not much difference between Facebook and a flea market. They are both providing a venue for vendors to sell their wares, but don’t control what people sell. They just want people to come to their flea market and make it as big as possible because it brings more vendors which brings more shoppers. And that’s revolutionary how? There’s very little new under the sun once you get past the bright shiny packaging…

   Heirarchies will always develop in any organization. Ant and monkeys develop organizational heirarchies because it is efficient from a resource perspective.

   I’m amused that you think any of this this is new or that the gen Ys have cornered the market on information use and ideas…the gen Y approach is is a reflection of ideas born in the ’60s, likely by your parents, who have influenced you to fight the establishment, either consciously or unconsiously. Of course almost all of them probably work now in companies with established heirarchies, as will you if you are in a successful business.

   That said, the passion and enthusiasm of youth is the driver that turns ideas into tangible value, whether monetary or otherwise. That’s the real advantage that you have over the establishment.

7. 7 Bob C. Jul 18th, 2007 at 2:52 pm

   I agree that the internet has leveled the field as far as knowledge is concerned. Progressive companies in the past have benefitted from all rungs of their organization. When I did consulting work many years ago, I would elicit information from each work area. I would ask each employee one simple question, “What three ways do you believe would improve the work processes/environment?” From each, I would get three responses and then compile them and then pick out the best. I would then package that information in a professional format and present it in a meeting with the top executives. They would look at it as brilliant and then implement it within their organization. Now, all they had to do was ask their employees the same thing and listen to what was being said instead of paying a consultant $50,000+ for the same information.

   Getting back to knowledge. It’s not knowledge itself that controls or has power (it’s only potential power). Real power comes from the application of the knowledge.

   As someone older here (55), I still continue to learn from both those that are younger and older than me. Each generation has something to offer, whether it’s wisdom or creativity. Only time will tell if corporations will become truely decentralized.

8. 8 Danielle Jul 18th, 2007 at 9:47 pm

   Sometimes I really miss Napster. Hahaha.

   Startup Week sounds really cool. My mom and her friend, Diane, are talking about starting their own company — they just haven’t had the perfect idea spark yet. I keep telling her to go online (she’s bored out of her mind at work) and cruise some blogs. They have more than enough experience and enthusiasm to take something small and make it huge.

   Hey, also out of curiousity — do you know any start-up or rapidly growing companies in the NH-MA-Boston area looking for a CFO?

9. 9 Bob C. Jul 18th, 2007 at 11:28 pm

   Hi Danielle,

   I’m in California and now do mostly trainings as well as coaching. You presented your mother with a great idea in looking into the internet to look for ideas. As far as finding them, make sure that she realizes that there has to be both a need and a want for what she’s offering to her marketplace. That brings up another point, make sure there’s a marketplace to market to. From my experiences, people who start businesses do it because of their personal belief of what they have people will want and that’s the farthest thing from the truth. Ask the marketplace and those blogs as well as message boards, will offer some information. Second, your mother should make sure that both her and her partner are passionate about what they will bring to the marketplace. Many people whom I’ve consulted and coached only thought about how much money they’re going to make instead of what it really takes to start and maintain a successful venture. Third, bring in good people as the business is growing. Those people should have strengths that will compliment the weaknesses in the people already in the business. For example: if your mother is weak in mundane tasks such as organization, the right person should have skills related to organization. Don’t bring in carbon copies of yourself. One of the things that I did was to write out my strengths and weaknesses and hire people that complimented my weaknesses (and there were a ton of them).

   Now getting back to the original topic presented here regarding decentralization, the new science of emergence may now be a big part of driving businesses in the future. According to the theory, there’s no central control (such as a CEO), instead control comes from the bottom up. In the study of flocks of birds, patterns will emerge when necessary for survival or otherwise. Even in humans we see the same type of patterns. In a sense anybody can be a leader at any given moment. Take crossing the street when the light at the crosswalk says to go. The first person that steps and walks to the otherside will be followed by others simply because that person has already established an easy route to follow. Maybe with the amount of people in the world, this may be the wave of the future. One the reason this happens is from following a set of rules. We may unconsciously do so. If all people in an organization follow certain rules and are disciplined, then there’s no need for central control. Every person is like the flock of geese where each will take their turn at leading and when needed, to avoid predators (competition) by setting new patterns (strategies) to create a stronger organization. According to Jim Collins’ book ‘Good to Great’, companies had to have the right people in place and know the destination where they are going. With that, leaders will emerge when needed at any given situation.

   Any thoughts?

10. 10 Ryan Geist Jul 19th, 2007 at 9:36 am

    Knowledge = Power

11. 11 Ryan Healy Jul 19th, 2007 at 9:56 am

    Bob C

    Very interesting take on decentralization. We do need a certain set of rules/norms, but absolute power and authority at the top of the food chain robs the “masses” of creativity and the leadership opportunities you describe. A CEO may be the longest tenured, most knowledgeable person in the organization, but he/she can’t possibly be the right person to lead every situation. Also, a decentralized system that puts more power in the hands of all employees, will find ALL employees really caring about the future of the organization. They will step up and lead when neccesary and sit back and take orders when it’s not appropriate.

    Thank you for your great insight.

    -Ryan

12. 12 Sean Jul 20th, 2007 at 2:06 pm

    I’m a huge proponent of user-owned content and finding ways to leverage those kinds of philosophies in modern business, but there are a couple things I wouldn’t recommend counting on:

    1. That any 23 year-old other than Mark Zuckerberg would turn down $1 billion for any reason other than to hold out for more money from someone else.

    2. That the “Startup Weekend” folks have the same supporting, productive experience once salaries, taxes, mortgages, and college tuition payments enter the mix.

    I can’t deny that the organizational model for global business is changing, or that the changes are generally for the better. But–Startup Weekenders aside–flat organizations with no chain of responsibility become entirely paralyzed when two or more very smart, equally deserving people find that they legitimately disagree about something … which happens often among the very smart and very deserving. Non-strategic, rock-paper-scissors decisions cannot steer a business for long.

    Everyone knows what a “decision by committee” is, and how long, slow, and painful it can be. In a flat, de-centralized organization, aren’t they all “decisions by committee?”

13. 13 Ryan Healy Jul 20th, 2007 at 2:29 pm

    Sean,

    You’re right, I dont think anyone would turn down $1 billion unless they had a brilliant idea (like the applications) in their back pocket, that would increase the value 10-fold.

    Second, when I think of decisions in a “flat” organization, I do not envision a decision by committe. Rather, it will be a decision by majority, like a true democracy. The CEO and execs would have their say, but the majority would always decide the action to take. This encourages everyone to be very careful and take personal responsibility when performing their jobs and making these big decisions.

14. 14 Bob C. Jul 20th, 2007 at 2:36 pm

    Sean,

    I believe in this case each person should take personal responsibility for his or her actions - especially when it comes to helping an organization and their customers. If done right (and this may be a big if) each person has the responsibility to take the lead on an issue that best suits their skills and experience. Most companies under the centralized form of business tend to “pass the buck” when dealing with a situation. Decisions are therefore made upward in the organization which can slow the process. One of my successful ventures in the past was an ad agency which I had 50 employees. And yet, each one has the responsibility to take the lead when necessary. In the early days of Federal Express, each employee was given the power to make a decision and implement it without going through the chain of command. Southwest Airlines did the same thing. Leaders can emerge even in centralized organization depending on what stage of development that organization is in. Think back to businesses in the past where there were no centralization. People tended to be more entrepreneural than later. With large corporations, there were people who settled in with little or no creativity waiting to retire. Think how these large corporations with loads of bureaucracy operate. Governments operate the same way. Entitlement runs wild in the latter and in many of the former, don’t you think?

    I used to work for the City of Los Angeles as a police officer back in the 1970’s and prior to that in the Marines (for 8 years). Each has people who wait for retirement and most tend to die soon after. Yet each thinks of entitlement. In my own case I don’t even come close to thinking that way. I left that old system and continue to progress (as long as my brain cells let me). I let the younger generation show me new ways of doing and thinking as my generation did back in 1960s and 1970s.

    In your argument about two equally deserving individual that would argue over an issue, that’s where leadership comes into play for that circumstance. As with most successful organizations, there should be people who have certain skills that can help facilitate a workable plan that’ll take into consideration the viewpoints of all sides, don’t you agree? I agree that “decision by committee” has not worked and tend to be bad form of leadership. By helping each person to focus on the bigger picture, namely the vision of the organization and take away egos (which can be hard to do), then workable solutions can be immediate. Again, in a decentralized organization, there has to be leaders that will emerge to make decisions immediately instead of going up the chain.

    One of the things I learned in the Marines was that any person can be a leader at any given moment. That’s one of the reasons leadership is taught down to the lowest levels. That’s was more apparent for me when I was with Marine Force Recon. Each person knew the mission and each had skills/expertise and was ready to take the lead when necessary to accomplish the mission.

    Bob

15. 15 Sean Jul 20th, 2007 at 3:15 pm

    Bob, my mother was a wise woman, and here are two things she taught me:

    1. Never argue with a police officer.
    2. Never argue with a Marine.

    But seriously: although I can’t disagree with anything you’ve said, I’m having trouble understanding the difference between what you’re describing and a centralized hierarchy. What you describe is an uncommonly open way to look at hierarchical working relationships, and I certainly agree with empowering people to take responsibility for and to make decisions about their own work–that’s how I try to run the department I’m running–but if you still have qualified “leader” figures to steer the company and to make final decisions, that’s a hierarchy.

    I was never a Marine, but when you describe everyone as “knowing the mission,” I have to assume that the mission came from somewhere, and that you didn’t insist on knowing all the decisions it was based upon or participating in those processes. You knew what your job was, and you knew how to do it well, and you knew that you were trusted to complete it properly. That’s an effective and efficient hierarchy, but I can’t help still seeing it as such. And in fact, that’s exactly the kind of system I’d advocate modern business working towards, with the “younger generation” (jeez, I’m only 36!) helping us get there.

16. 16 Bob C. Jul 20th, 2007 at 4:09 pm

    Sean,

    Granted, that it may seem as hierarchy type of organization. In this sense though, there’s no true pyramid system as we see in traditional companies and organizations. What I’m saying is not having the decisions being made from the top person, but from the leader when it is needed. That leader could be a team leader or the individual so long as they follow along the line of helping the customer, that means to better serve them. In a sense, it becomes more of having an entrepreneural mindset versus “The Organization Man” mindset.

    As for the mission of an organization, getting input from every person is important so long as they are able to see the bigger picture of the helping the customer. Again, many companies started out with one vision and mission and as management has changed and the further they’ve gotten away from the founder’s mission, the focus and in many times, the spirit has changed. Walmart presents a good example here. Sam Walton provided a spirit and motivation that has gone the opposite way since his passing. His children and the people currently running it are more focused on money rather than providing value for all involved. And with Sam Walton, that included the people that worked there.

    Back to the entrepreneural mindset. What I’m advocating is that each person that comes into an organization should think of themselve as a service company that provides a value to the organization that contracts with them instead of the mindset of an employee. If I were to be hired in the traditional sense, I would make sure that I can provide value way above the compensation that’s provided to me. If I need additional education, then that would be part of the picture.

    Back when I was in the Marines, yes we had a mission to accomplish. In Force Recon as with any type of Special Forces, the individuals used their own ingenuity to figure out how to best accomplish the mission. That mission did come from some higher rank. Yet when decisions were made, we did it on our own. As a team, we each had certain expertise that worked well, much like any sports team. My background in playing football helped me. There was a team leader, usually a 1st Lt. I was the the team ranking NCO (Sgt.). Each team member was capable of taking over the mission as leader (if necessary).

    It was much different when I joined the LAPD. It was more of the traditional hierarchy. And since most of the police officers were members of the Police Protective League, it was more about me versus the vision and mission of “To Protect and To Serve.” I left in 1981 to start my own business.

    Your thoughts?

    Bob

17. 17 Jim Aug 7th, 2007 at 12:44 pm

    Hey Ryan,
    Been checking in on the VoSnap blog lately? Seems they realize they might need a CEO and a small group of people to actually get the company off the ground. So much for your nirvava…

18. 18 Bob C. Aug 7th, 2007 at 1:52 pm

    Jim,

    That’s much the same when many of the initial dot.coms went bust several years ago (along with a lot of money). They were running their businesses by “the seat of their pants” approach with no plan and no exit strategy. It seemed that each person had their own idea on where to go with no central focus in place. The CEO can help in establishing that.

    Your thoughts?

    Bob

19. 19 Suzanne Oct 31st, 2007 at 7:39 pm

    I know this thread is old and nobody will probably read this, but I’m posting anyway. I’m a 36-year-old Gen Xer. In some ways, the Gen X first experience into the corporate world is similar to Gen Y - we were much more tech savvy than the old workers. However, at that time, technology was not as significant to how we get work done as it is today.

    I am a believer that Gen Y is going to change the workforce for the better - get rid of the hierarchal crap and Babyboomerisms such as synergy, synergize, and synergistic. However, what is the #1 to success is relationship building. That means, if you can’t get along with the Xers and Boomers, you are basically screwed - no matter what skills you bring to the table.

    Gen Y is young. All generations have a certain sense of bravado in their 20s (myself included). Keep pushing the envelope - but don’t forget that you should always give props to people that are older you - even the janitor who is sweeping the floors - for simply being on this Earth longer than you. Once I started doing this, I found stepping into a leadership role was a lot easier, because most people are willing to accept that a younger person can have superior skills, but that doesn’t give license to act like a punk.

20. 20 Nicholas Beckloff Jan 25th, 2008 at 10:19 am

    I realize this thread is old but this article isn’t. The NY Times(Who’s Cuddly Now? Not Law Firms) piece sums up the effect of Gen Y values on the workforce of today. It says that the field of law, once a highly regarded job to have, has been scrambling to catch up to the changing values of the new generation. Scores of lawyers overworked and depressed lawyers are passing up massive bonuses and pay increases to find greener pastures. Combined with Gen Y’s desire to have more flexibility in its time this has caused a change at the very bedrock of the field of law. Now firms have changed the way they bill hours, allow vacation time, and even made different partner tracks. Early statistics already show that an overwhelming majority of practicing lawyers have decelerated their career paths in exchange for family time. Another piece of evidence they cited was this:

    “A harbinger of changing times might well be the brief filed by the hard-driving white-shoe firm of Weil Gotshal & Manges of New York, asking a judge to reschedule hearings set for Dec. 18, 19, 20 and 27 of last year.”Those dates are smack in the middle of our children’s winter breaks, which are sometimes the only times to be with our children,” the lawyers wrote.

    The judge moved the hearings.”

    It goes to show you that the times….they are a’changin.

21. 21 Will Kriski Mar 14th, 2008 at 10:25 am

    I’d like to talk about the value of geographical decentralization of work and other services. There are many benefits in my opinion which are:

    1. Cost savings
    2. Security
    3. Environment
    4. Quality of Life

    Cost savings - the reason office space is expensive in downtown areas is that everyone wants to be there. If a company distributes its workforce and allows people to work from home the company has lower costs. Workers save money on gas, parking, business clothes, nannies, lunches, etc. Imagine what this would do to the distribution of housing prices as well.

    Security - companies have backups of their data stored offsite in secure bunkers. That is, their data is decentralized. In addition to the possibility of natural disasters, think about terrorism for a second. Every city is vulnerable to some sort of attack because everyone is in one place at the same time. Imagine if people were scattered all over a wide geographic area - less of a target perhaps? If you look at food and water safety, access to electricity etc, with centralized delivery we are all at more risk. Buying local, generating your own power, etc decentralizes and lowers the risk.

    Environment - obviously with thousands of people in every city no longer commuting there will be huge reductions in pollution.

    Quality of Life - Workers are happier because they don’t spend hours commuting in rush-hour traffic, can perhaps watch their own kids (what a concept), and get more done (less distractions).

    Does it make sense for millions of people to drive for hours to one central location in the morning and back again in the evening? Technology makes the idea of remote work much more feasible. Of course you as a boss have to be able to measure what your employees are accomplishing. You do know how to do this don’t you?

    Will Kriski
    thewealthyworker.com

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