ConsenSys: A Decentralized Organization Building Decentralized Technology
How does the decentralization of technology influence the structure of a company’s internal organization?
As technologies advance and an increasing number of millennials dominate the workplace, we are seeing an exponential growth of businesses moving away from traditional company structures. Many new companies are gravitating towards innovative work environments that foster flexibility, trust, and transparency. ConsenSys is a blockchain venture production studio with global efforts in economic, social, and political sectors. The company has implemented a non-traditional business structure, a decentralized organizational system which places a high level of trust for its employees to manage themselves.
In a decentralized organization, there is no hierarchical management team that makes most decisions on behalf of others. Each individual has the authority to make their own decisions, with an eye to adding value to their team or to ConsenSys as a whole. A decentralized organization and the self-management way of working resonate symbiotically. Self-organization is a process where order emerges when individuals and teams interact within an unstructured system. Under fluctuations and feedback, order establishes based on the actions and interactions between team members. With teams establishing their own order and decision making strategies, this results in an organization that is decentralized. Since this process allows teams to constantly reorganize themselves based on what works best for them, the whole organization itself is able to survive and repair in times of chaos and unpredictability.
The failings of a traditional hierarchical system hit us right in the ‘gut,’ at a human and soul level.
ConsenSys’ unique organizational structure is built on trust and is heavily inspired by the components of a blockchain. In a discussion with Russell Verbeeten, he emphasized that ConsenSys is comprised of a network of interdependent teams cooperating while simultaneously pursuing their own goals. This structure mimics the communication structure of the decentralized systems ConsenSys builds together with the larger Ethereum ecosystem. ConsenSys embraces Conway’s law, which suggests that organizational structures should mirror the architectures of the technology they are building.
By mirroring the communication structure of the technology, ConsenSys has recognized a higher level of flexibility, openness, and innovation. Verbeteen shared that, “Blockchain powers innovation because the infrastructure developed on platforms like Ethereum brings online open systems that are available for developers, entrepreneurs, and companies, ready to repurpose for their own needs.” Innovation is vital. ConsenSys is organized the way it is because they need to optimize for innovation upon this emerging technology.
The failings of a traditional hierarchical system hit us right in the ‘gut,’ at a human and soul level. We sometimes have just an inkling that the system doesn’t fit us; other times it just feels downright oppressive. I believe globally we are starting to feel the effects of the current system quite emotionally. The centralized power structure in a traditional hierarchy has the power to unilaterally block great ideas and destroy productive innovations and consequently the human spirit. Alternatively, self-organizing and self-governing systems give opportunity for individuals to contribute ideas and watch them come to life with the support of a community. Web3 and decentralized organizational structures have the potential to unleash people who are creative and create space for everyone to bring their unique skills and passions to a collaborative value creation process. This is an emerging alternative paradigm for human organizations that I feel the world has long been waiting for.
Bryan Peters
Peters mentioned several great points above. At ConsenSys, the decentralized system allows employees to work transparently and encourages innovation, but it also impacts employees on an emotional level. Companies are starting to adopt non-traditional structures and new strategies to better support and motivate employees. In a healthy self-organizing team, creativity is embraced openly, employees have a direct input and connection to the company’s growth, and they have the freedom to utilize their knowledge to implement their own ideas. With blockchain technology being highly innovative and moldable for improvement, an organizational structure that supports a culture of innovation is essential to success.
The recent innovation of a rather simple data structure, the blockchain, is novel in human history and makes entirely new ways of coordinating social activities possible.
Blockchain redefines trust between entities and is revolutionary in the way individuals, businesses, and governments work together. Here are a few key thoughts gathered on Web3’s impact in our existing ecosystem:
Web3 is about controlling your own information and being able to relinquish the powers from a central party or monopoly. It is about empowerment of the people and providing choice and censorship-resistant platforms that enable us to become equals. The ability to remove the need to rely on trust is critical to its success. You will likely see a higher adoption of Web3 technologies by people that currently can’t trust their governments (i.e. third world countries) to do what is best in the interest of their country.
Kevin Zhang
Web3, unlike the internet today, places trust at the infrastructure level. The emergence of Web3 and blockchain is now providing a trustful foundation for us to build on as a global community and try new things. A protocol that creates the opportunity to improve human sharing and collaboration. Anything too rigid constrains the innovation cycle. Web3 requires us to constantly have new ideas and the more rigid we are, the less relevant we will become in this rapidly evolving Web3 world. In the past, we’ve never had a technology that can support some of the hypothetical social and economic improvements scholars hypothesized and so many of these great ideas didn’t get implemented. I’m watching the conversation shift from “Blockchain can’t do this or that,” to, “How fast can blockchain scale up to help us achieve this?”
Bryan Peters
Both Zhang and Peters alluded to the fact that the impact of Web3 on our existing ecosystem can be enormous. Wherever we have transactions that involve trust, Web3 may have the potential to intervene. Instead of being limited by what we have before us, we now have a foundation we can build on to achieve what we have not reached before. As more minds come together to collaborate and innovate, the full potential of Web3 is unimaginable.
Now, you may be wondering why the average modern community should care about Web3 or the decentralized organizational structure that ConsenSys offers. Kirk Dameron shared that “the recent innovation of a rather simple data structure, the blockchain, is novel in human history and makes entirely new ways of coordinating social activities possible.”
We believe there is a strong sense in which these organizational strategies extend beyond the technological needs as put forward by Conway. As the rate of change accelerates in society, decentralized organizational strategies both help build the technology of decentralization and are themselves enabled by the technology. As our own internal infrastructure matures, ConsenSys believes that other organizations needing to move themselves away from traditional hierarchies will be able to benefit from the tools we are building. Our mission is surely to build software for ourselves and others that can help the world adapt to the new economic realities of the 21st century.
Russell Verbeteen
ConsenSys believes in Web3 and the decentralized organizational structure. Though this new paradigm is still in the infancy phase, ConsenSys’ largely decentralized structure has accelerated the emergence of many new and exciting experiments. More importantly, as highlighted above by Verbeteen, ConsenSys has built tools and processes to help them manage themselves in a decentralized way. Other organizations moving towards a decentralized system can benefit from these tools that ConsenSys has built and continues to build. Effective tools and strategies are to be shared. Change is accelerating quicker than it ever has, and ConsenSys is building tools to equip others to better prepare for the future.
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- November 20th — BlockRemix, A Blockchain Networking Event
- December 6th — Block 8: Enterprise Blockchain Radically Simplified
Disclaimer: The views expressed by the author and contributors above do not necessarily represent the views of Consensys AG. ConsenSys is a decentralized community with ConsenSys Media being a platform for members to freely express their diverse ideas and perspectives. To learn more about ConsenSys and Ethereum, please visit our website.
