The industrial make-and-sell model required explicit skills as we still know them. The decisive thing was your individual knowledge and individual education. Today, in the new economic spaces you work more from your relations than your skills. The decisive thing is your network. Work is interaction.
We have so far followed a very crude pyramid-like classification in work: skilled work was what highly educated individuals would do. Semi-skilled work was possible for trained people. Unspecified labor was what almost everybody could do after onboarding. This classification of work led to the unintended consequence that the most economical design of mass-era organizations reduces the amount of skilled work and increases the amount of less-skilled work, thus reducing costs. A bigger problem than low-skilled people is the low-skilled occupations we have created.
The classification of work as different bundles of skills and responsibility has been very easy to grasp and easy to follow in compensation schemes. More skills and/or more responsibility — more pay. Managers, who are responsible people, are given responsibilities — and higher wages. Workers are given less demanding tasks, less responsibility — and lower wages. The argument behind this is a circular, self-fulfilling prophecy. People who are not made responsible tend to avoid responsibilities and therefore never become responsible. Skilled people acquire more skills because of the higher cognitive demands of their work. Less-skilled work roles give fewer opportunities for learning, leading in fact to a slow but certain de-skilling of the workers. This is something we see in many industries today. The phenomena and the causes of the problem become the same.
The organizational system of skills and responsibilities was created on the basis of the assumption that all that has to be done can be known and managed with efficiency and insight. In mass production, work corresponds mainly with what has been planned and budgeted. But today, in more contextual problem solving, work corresponds mainly with complex engagements with the customer.
The focus changes from generic skills to contextual presence, empathy and interaction.
The most modern definition of work is “an exchange in which the participants benefit from the interaction”. Interestingly, cooperation is also described as “an exchange in which the participants benefit from the interaction”.
The technological environment of work has changed fundamentally, but we haven’t yet developed a new mode of economic space design, and neither have we escaped from the pull of the traditional industrial system. Our relations at work are still asymmetrical involving status differences based on systems of responsibility and systems of skills. This inbuilt systemic fault generates increasing social distance and inequality, as we now see.
Because of the variety of contexts people work in, work requires interpretation, exploration and negotiation. The interpreter with the best situational awareness is the worker working together with the customer, not a manager. The relations are built on symmetry.
What defines most problems today is that they are not isolated and independent. To solve them, a person has to think not only about what he believes the right answer is, but also about what other people think the right answers might be. Work, then, is exploration both what comes to defining the problems and finding the solutions. Again, the relations need to be based on symmetry.
Most decision makers are still unaware of the implications of the complex, responsive properties of the world we live in. Enterprises are not organized to facilitate interactions, only the actions of parts taken separately. Even more, compensation structures normally reward improving the actions of parts, not their interactions. This is why conventional jobs are increasingly inhibiting flexibility and contextual responses to new problem definitions or new technological solutions to old problems.
To succeed in the new economic spaces we need symmetric relationships, open assets and very open organizations.
When customers are identified as individuals in different use contexts, the sales process too is in fact a joint process of solving problems. You and your customer necessarily then become cooperators. Together, you are trying to solve the customer’s problem in a way that both satisfies the customer and ensures a profit for you. The industrial make-and-sell model required (explicit) skills as we still know them. The decisive thing was your individual knowledge and individual education. Today, in new economic spaces you work more from your presence and network than your skills. Work is interaction.
The really big objective of digital transformation is to reconfigure agency in a way that brings these relationships into the center. Success today is increasingly a result of skillful presence: it is about empathy and interaction. Through new technologies and ubiquitous connectivity, we have totally new opportunities for participation and communication in the new economic spaces
These economic spaces are about interdependent individuals and groups defining and solving problems in shared contexts utilizing smart contracts.
Individuals competing on job markets may be one of the historic mistakes we have inherited from the early industrial era. It made sense a very long time ago but now we should think differently.
Interaction creates capability beyond individuals. Cooperative performance can be more than what could ever be predicted just by looking at the performance of the parties involved. It is not about individual skills any more. Skills, performance and resilience are emergent properties of cooperative interaction. They are not attributable to any individuals. Higher performance is more a result of the quality of interaction than the quantity of training and education.
Networks provide problem-solving capability that results directly from the richness of communication and the amount of connectivity. What happens in interaction between the parts creates a reality that cannot be seen in the parts or even seen in all of the parts.
This is why it does not make sense any more to talk about skill levels and just managers being responsible. Either you are present in a relevant way or not. Neither can responsibility be somewhere else. You can only be present and contribute if you are response able.
Credits Nick Hanauer and Katri Saarikivi