Business Design, Evolution and Technology

We have seen that human social systems, including enterprises, are living systems. We have also seen that they are designed.  The issue of business design is a major concern these days, especially in light of the proliferation, and even patenting of various forms of business model or design (priceline.com).


One of the best discussions of business designs is to be found in the work of Adrian Slywotzky.  In the Profit Zone he identifies twenty-two distinct profit-generating designs, which businesses use alone, or in combination.[37]  These business design are memetic, spreading and mutating throughout the marketplace.  Designs become symbiotic with each other, within and across corporations.  These merge and morph into new forms, through a process reminiscent of symbiogenesis.


Maturana and Varela’s notion of a “unity” is becoming more and more problematic in the business domain.  Downsizing, outsourcing, disintermediation, reintermediation, virtual organizations, cyber-organizations, supply chains, supply webs, industrial ecologies are all forms of human social systems that are constantly being invented and reinvented.  The permutations of Slywotzky’s profit patterns overlay the enterprise cognitive architecture in interesting and novel ways, and each new form is a socio-technological hybrid.


The evolution of business designs is largely driven by information technology.  The various technologies are themselves manifestations of powerful memes, which are also evolving at a very rapid rate.  This gives rise to the variations among socio-technological human systems that expand the possibilities of the enterprise cognitive architecture.  This is the mechanism of symbiogenesis in action, and it is accelerating.


Information technology has changed the rate of propagation of organizational structures and business designs.  It is giving rise to a whole new class of market-facing enterprises.[38]  Bradley and Nolan provide a number of examples of this new breed of networked organization based on innovative use of technology.[39]  Downes and Mui call the dynamic at work here the "law of disruption".[40]  This concept is that social and business changes are propelled by, but always lag behind, the furious changes brought about by the cumulative effect of Moore’s law (that predicts the rate of increase in computing power) and Metcalf’s Law (that predicts the rate of increase in the adoption of networking technologies).  For our purposes it is quite apparent that these rapid technological changes alone are capable of introducing plenty of variety into the ecology of human social systems, which can be operated on by the universal Darwinian algorithm.


With information technology we’re introducing something that is equivalent to some new kinds of neurons for the cognitive substrate of human social systems.  The technologies allow imitation and propagation of business memes at an increased rate (fecundity), and with the potential for perfect fidelity, but also with the potential for stronger variability through deliberate or inadvertent changes at each point of propagation.


The single biggest factor in the acceleration of this application of the universal Darwinian algorithm is the Internet.  The Internet is a manifestation of the network meme, which is at the heart of systems thinking.  It is quickly becoming the most powerful meme propagation engine yet, and it is propagating the meme of itself, the Internet.

There is a major implication for the information technology industry in all of this.  To the extent that there is intentionality or design in human social systems, it is the result of purpose and accountability.[41]  We sometimes think of technology as playing a role, or taking over responsibilities from human role-players.  This is role in the sense that we’ve defined it as the set of commemes linked to a pactplex.  But a machine cannot hold commemes or form social integration units.

Who, then, is accountable when technology takes the place of functions formerly performed by accountable human beings or introduces functional capability that was not even possible before?  The answer can only be that when technology is increasingly inserted into the fabric of our lives, there is an accountability that includes both the creator and the installer of the technology.  This linkage is not always understood as an explicit pactplex, and is a dangerous point of potential abdication of responsibility.  Clarifying and making explicit the accountabilities that are evolving at the combined rate of evolution of technology and human social systems will be a growing challenge as far as we can see into the future.