A Manifesto for the Philosophy of the Future — Networkism
The culmination of a new philosophical outlook harnessing new technologies through new organization types will drive forward exponential gains for humanity.
— We, the Enlightened Generations
Section 1 — The Deception of the New Normal
A common refrain that you hear in government and in the private sector is that we are in a “new normal” — meaning that recent changes are here to stay and we are not going back to the pre-crisis state of the world. Many in the finance industry (certainly the regulators) view the economic crisis as the driver for the new normal, because it fundamentally altered the interaction between the regulators and the regulated and changed the expectations that the industry and its regulators face from consumers and representatives in government. Some financial institutions also hold a foundational belief that self-transformation into a technology company is a necessary predicate to compete in the future. This view begins with the perspective that transformative technologies must be harnessed appropriately, and the traditional bank model is ill suited to do so.
However, these insights do not nearly tell the entire story. If you truly understand the rate of change in technologies, you are definitely closer to understanding the exponential changes that are coming. But, by focusing on the what, these insights do not capture how completely the world as we know it will change. They do not provide enough explanation for how and why these changes are taking place, and without capturing the how and the why, they are not sufficient explanatory devices.
The right explanatory device matters. A lot. Because the lack of a sufficiently deep understanding of the changes will be a cause of failure — both personal and corporate. A failure of understanding means you individually and you collectively will not bring forward enough motivation and energy to bear on the enormous tasks at hand — survival and, for the lucky few, incredible success.
A Shift to the Exponential
We are witnessing a shift from a linear rate of change to an exponential rate of change. This is occurring most visibly in technological advances.
Many technologies have been developing at exponential rates of change per Moore’s Law and other laws of technology (such as Ray Kurzweil’s Law of Accelerating Returns,[1] Kryder’s Law, Cooper’s Law, Butter’s Law, Nielsen’s Law, etc.). As these technologies become cheaper and more ubiquitous, a level playing field emerges to deploy these technologies. This results in an exponential rate of change across the board.
This shift will result in changes in the next 20 years as impactful as changes over the last 200 years. In 10 years, 40% of the Fortune 500 will go out of business and be replaced by new types of businesses that have disrupted the old incumbents across every industry.[2]
This is the time of supersonic change.
Those incumbents that remain will also be disruptors — they will have had to disrupt themselves in order to ensure their survival. The good news for incumbents is that we have seen many firms accomplish this in the technology industry, which is perhaps more complicated industry to disrupt oneself than in finance. The finance industry itself has many natural defenses, not least of which is the complexity of the regulatory systems and the rich data that incumbent financial firms have (the first, an environmental advantage; the second, an incumbent advantage). Although many fintech companies have been able to start to decay the first advantage, the second advantage is not anything that a fintech company could affect. And we will see incumbent financial institutions accelerate into the future by using its rich data sets and natural advantages.
The Fourth Industrial Revolution
While there is no consensus about the extent and pace of upcoming change and how great a tempest of disruption will be unleashed through innovation, many believe that the technologies coming into being are colliding to form a Fourth Industrial Revolution.
Klaus Schwab, Chairman of the World Economic Forum, explains:
We stand on the brink of a technological revolution that will fundamentally alter the way we live, work, and relate to one another. In its scale, scope, and complexity, the transformation will be unlike anything humankind has experienced before. We do not yet know just how it will unfold, but one thing is clear: the response to it must be integrated and comprehensive, involving all stakeholders of the global polity, from the public and private sectors to academia and civil society.
The First Industrial Revolution used water and steam power to mechanize production. The Second used electric power to create mass production. The Third used electronics and information technology to automate production. Now a Fourth Industrial Revolution is building on the Third, the digital revolution that has been occurring since the middle of the last century. It is characterized by a fusion of technologies that is blurring the lines between the physical, digital, and biological spheres.
Source: World Economic Forum, https://agenda.weforum.org/2015/12/the-fourth-industrial-revolution-what-it-means-and-how-to-respond/
Although the descriptor — a Fourth Industrial Revolution — appropriately captures the intensity of the transformations that are being brought about now and in the future, I believe this term evokes old pattern thinking and probably does not enrich enough of an understanding of the changes that are coming. And more importantly, while it may drive conceptual awareness and understanding of the magnitude of change (i.e,. the effect of change), it does not capture an understanding of the why (i.e., the driver for change).
While the technological narrative is absolutely true, I believe a focus on the technologies keeps our minds operating within a narrow narrative. This is due to the fact that advances in technologies — even when you account for the exponential rate of technological advancements and even when you account for disruption across a broad range of industries — do not by themselves produce change.
Why is that? Because technology needs to be deployed. The individuals, corporations, and other actors that deploy technology, and the mindstate that they occupy, are the fundamental determinants of the impact that new technologies will have on the world and the course of humanity.
Consider a counterfactual on the First Industrial Revolution based on the experience of an earlier historical time of great technological innovation that fizzled out:
It is easy to imagine a counterfactual technological steady state of the techniques that had emerged between 1750 and 1800 of throstles, wrought iron, coke-smelting, and stationary steam engines, in which there was a one-off shift from wool to cotton, from animate power to low-efficiency steam engines and from expensive to plentiful wrought iron. It is easy to envisage the economies of the West settling into these techniques without taking them much further. Such a development would have paralleled the wave of inventions of the fifteenth century, with the printing press, the three-masted ship, and iron-casting settling into dominant designs and the process of improvement slowing down to a trickle subsequently.
Why did this not happen? The fundamental reason is that before the Industrial Revolution all techniques in use were supported by very narrow epistemic bases, that is to say, the people who invented them did not have much of a clue as to why and how they worked. The pre-1750 world produced, and produced well. It made many pathbreaking inventions. But it was a world of engineering without mechanics, iron-making without metallurgy, farming without soil science, mining without geology, water-power without hydraulics, dye-making without organic chemistry, and medical practice without microbiology and immunology. The main point to keep in mind here is that such a lack of epistemic base does not necessarily preclude the development of new techniques through trial and error and simple serendipity. But it makes the subsequent wave of microinventions that adapt and improve the technique and create the sustained productivity growth much slower and more costly. If one knows why some device works, it becomes easier to manipulate and debug it, to adapt to new uses and changing circumstances. Above all, one knows what will not work and thus reduce the costs of research and experimentation. The Industrial Revolution, in short, would have been eventually constrained by the narrowness of useful knowledge and ground to a stop.[3]
Certainly, technologies are key foundations for the massive changes we are about to experience, as obviously without them there is no Fourth Industrial Revolution. But, I submit that technologies are not the biggest drivers. Overly focusing on technologies distracts attention to the other fundamental changes that are coming together now (that are the focus of my discussion below), which I believe are the critical drivers that will completely change the world as we know it.
These other forces enable the maximum use of these technologies for maximum impact and are more transformational than the technologies themselves. Specifically, new forms of organization and the decided shift to a new state of mind, in concert with the new technologies, will create a technological revolution that is orders of magnitude greater than all that have come before it. Therefore, a new way to describe these changes and how to use them, would be a more complete explanatory device because it would describe the how and why in addition to the current focus on the what.
A focus on the what gets you half way there — incredible change is coming — and could, if utilized correctly, result in the company surviving through the changes. But without all constituent parts of the company understanding the how and why, the company will not emerge from the chaos as one of the few winners.
Incredible Energy is Released by New Building Blocks Coming Together
The great shift from linear to exponential is being brought about by foundational changes in numerous building blocks.
What are these building blocks? There are four main building blocks, including technology, that will come together to produce this revolution, and they operate individually and in connection with each other (that is, they overlap as well).
New technologies are being developed at exponential rates of change. The internet, cloud computing, agile database management systems, big data analytics like machine learning and deep learning, and mobile technologies are all now robust technological foundations for unleashing exponential change. They are being used by visionaries to cheaply create hyper-intelligent software platforms. These new technologies are being deployed on large scales to transform the way we organize companies and are enabling discovery of new and creative solutions to intractable problems, putting pressure on existing industries and incumbent leaders. The technologies around the corner — blockchain, internet of things, artificial intelligence, nanotechnology, and 3D printing — will unleash more exponential change when they become ubiquitous. Although it is far from a complete explanation, I believe the stand-alone focus on this technological tipping point is fair, as it is the only building block that is static (i.e., not made up at least in part by other building blocks).[4]
New, agile methodologies enable the creation of products and services that take into account the preferences of their consumers by bringing humanity into the development of products and services (human-centered design). They do this by deeply evaluating customer needs, prototyping new products, and ideating innovative solutions.[5] This profound innovation has the effect of aligning interests between consumers and the companies providing the products and services in a way that was never before achievable (even where contemplated). This stands in contrast to the type of product development and proposal review that has resulted in customer abuses, where products were designed and proposals reviewed principally for their effect on the balance sheet (P&L perspective). In retail financial services, where you see this manifest is in the move away from designing short term, single use products for consumers that were created out of a P&L demand and shifting towards developing products and services that are designed to meet a consumer’s overall financial management needs across the long term. The deployment of agile methodologies in product development is enabling new organizations to significantly disrupt entire industries.
A new agile, organizational type has emerged and is already winning. The leaders of these organizations (visionary founders and their venture capital backers) are taking advantage of new technologies, distinct resource-usage practices, agile product development and management methodologies, and a distinct state of mind, to capitalize on opportunities and produce an exponential impact. They also integrate and take advantage of the products and services from other start ups to further their exponential impact.
The advanced use of advanced technologies permits these organizations to achieve higher rates of productivity than incumbents, and new organizations aim for 10x higher productivity. The asset-light model (including people assets), even in traditional asset-heavy industries, permits insanely fast growth with less capital needs. The fast, iterative product development cycle ensures that these organizations hew close to the needs of their customers and constituents.
The names given to this emerging organizational type include “purpose driven organization,” “exponential organization,” “teal organization,” “conscious company,” and “digital company.”
Each of these conceptions is slightly different but most point to one key foundation — that the organization is centered around a transformative purpose. The “purpose” referred to by each of these thinkers is obviously a purpose above and beyond shareholder profit maximization. [6]
I add my own conception of a “true-hearted organization” much further below — it is an organization that has as its purpose a humane mission no matter what massive transformative purpose is central to its products and services, and this organization embeds its humane mission into all parts of the organization, including its people resources, organizational management, and the technology it builds and deploys.
New tech companies embodying this organizational change are, of course, already benefitting handsomely — through economic gains, incredible cultural power, and an emerging political power.[7]
Frank Diana’s conception of the Digital DNA of the Future of Companies:
Source: Frank Diana, https://frankdiana.wordpress.com/2015/12/01/enabling-the-future/#more-2069
Federic Laloux’ Teal Organizations:
· Self-management. Teal organizations operate effectively, even at a large scale, with a system based on peer relationships. They set up structures and practices in which people have high autonomy in their domain, and are accountable for coordinating with others. Power and control are deeply embedded throughout the organizations, no longer tied to the specific positions of a few top leaders.
· Wholeness. Teal organizations invite people to reclaim their inner wholeness. They create an environment wherein people feel free to fully express themselves, bringing unprecedented levels of energy, passion, and creativity to work.
· Evolutionary purpose. Teal organizations base their strategies on what they sense the world is asking from them. Agile practices that sense and respond replace the machinery of plans, budgets, targets, and incentives. Paradoxically, by focusing less on the bottom line and shareholder value, they generate financial results that outpace those of competitors.
Salim Ismail’s Exponential Organization
An Exponential Organization is an organization whose impact (or output) is disproportionally large — at least 10x larger — compared to its peers because of the use of new organizational techniques that leverage accelerating technologies, by leveraging:
· one massive transformative purpose which, as described in its mission statement, does not refer to what the organization does, but rather what the organization aspires to accomplish. Massive transformative purpose aims to capture the hearts, minds, imaginations, and ambitions of those both inside and outside the organization.
· one or more S.C.A.L.E. externalities (see diagram below).
· one or more I.D.E.A.S. internal mechanisms (see diagram below).
Source: http://www.seedsumo.com/sumo-blog-1/ywt3l8v1vv5r3jqf1wso5rfxwzw062
Source: Exponential Organizations
Conscious Business:
Higher Purpose: Recognizing that every business has a purpose that includes, but is more than, making money. By focusing on its Higher Purpose, a business inspires, engages and energizes its stakeholders.
Stakeholder Orientation: Recognizing that the interdependent nature of life and the human foundations of business, a business needs to create value with and for its various stakeholders (customers, employees, vendors, investors, communities, etc.). Like the life forms in an ecosystem, healthy stakeholders lead to a healthy business system.
Conscious Leadership: Human social organizations are created and guided by leaders — people who see a path and inspire others to travel along the path. Conscious Leaders understand and embrace the Higher Purpose of business and focus on creating value for and harmonizing the interests of the business stakeholders. They recognize the integral role of culture and purposefully cultivate Conscious Culture.
Conscious Culture: This is the ethos — the values, principles, practices — underlying the social fabric of a business, which permeates the atmosphere of a business and connects the stakeholders to each other and to the purpose, people and processes that comprise the company.
Source: http://www.consciouscapitalism.org/node/3998
Aaron Levy’s Digital Companies versus Industrial Companies:
Source: Medium, Aaron Levy, https://medium.com/the-industrialist-s-dilemma/the-industrialist-s-dilemma-is-a-new-course-at-the-stanford-graduate-school-of-business-that-runs-6a13702011bc#.rcpug8xk1
The emergence of a new mindstate is the most profound change of all. Some thinkers rightly point to a sense of purpose as a defining characteristic of our new generations, particularly our millennials (as well as a key feature of the new organizational type). In that respect, we are observing that our newest generations have a profoundly different mindstate than the rest of the world, as they have natively absorbed all these technological changes and recent historical experiences. These generations may not even fully consciously understand how profound these changes are or what to call the collective mental state that they embody, yet they understand that there is real a difference between generations, and they actively exploit these differences to their advantage.
Source: PurposeDrivenEconomy.com
I believe this change in mindstate is actually a philosophical change. A foundational shift in mindstate is so profound because it so seldom comes about in the history of humankind (by my count, this would be the third major shift in global philosophy).
Those companies that understand the driver this new philosophical outlook and its profound meanings — and use this understanding to ride the wave of change will emerge as victors against those companies that do not.
So, what is this driver of change, this new global philosophy?
Section 2. A New Philosophy — Networkism — the Theory for the Future
I call this new philosophy — this new shift in perspective — “Networkism.”[8]
Networkism means simply that everything is interrelated through networks and systems of networks. Networkism is in essence a shift in perspective from the Individual to the Relational. Specifically, this shift is from today’s individual-based society (including social systems that are largely based on maximizing gains to individual actors) to a relational-based society (creating social systems that are largely based on maximizing gains for society at large).[9]
This shift in perspective is the 3rd biggest philosophical change in common mindset in the short history of humankind, from God ordains, to the Individual rules, to now, the Network directs.[10]
Each of these philosophical perspectives has at its core a purpose for individual actors, be they Kings or subjects, men or women, corporation or nation-state:
· The Philosophy of God: one’s purpose is to honor God’s wishes;
· The Philosophy of the Individual: one’s purpose is to exist and maximize our happiness as an Individual;
· The Philosophy of the Network: one’s purpose is to further the advancement of society as a whole.[11]
This new philosophical outlook is being employed to harness new technologies through new organization types and this will drive forward exponential gains for humanity.
Networkism is rooted in the recognition that, from time immemorial, all human networks that have emerged or been created have always operated to enhance our relationships to each other and the physical world (i.e., advance the state of humanity). The networks are not in and of themselves humane; rather, they must be created and/or harnessed by humankind in order to operate to protect and/or advance some gains (at the individual, group or subgroup level).
Networks have not, of course, always been harnessed in ways to advance the well-being of humanity as a whole; most often, networks are used to empower and enrich those who have the greatest resources, whether they be God-ordained Kings in the Philosophy of God, or multi-national corporations in the Philosophy of the Individual.
Without the shift in view to the Individual, companies never would have achieved the scale and reach and power that they did. Their divorce from royal authority was a liberation and set companies on a trajectory that would not have been possible without this liberation. Because of this philosophical change, the welfare of individuals and society at large has advanced across the board in dramatic fashion.
At its core, Individualism enables each unit level, natural person or legal person, to maximize its own well-being at the expense of others in the networks and system. This of course fails to maximize the well-being of humanity as a whole. In modern times, have witnessed the dissolution of networks because of the failures brought by the philosophical focus on the Individual, which, through rent seeking, created social and economic structures that are either inhumane or unsustainable / unstable (think slavery).[12]
We also can realize that Individualism is at its core fallacious because it requires one to suspend reality and consider each Individual node in the Network on a stand-alone basis.[13] Individualism is a great and important fallacy that was formulated to break the backs of previous networks and systems that were created in the Philosophy of God, like divine right systems (think a caste system).
But, I think we can recognize the simple and core truth that nothing exists in the absence of its relationship to other things. We have seen this in the physical laws of the natural world. And we have seen this in the natural laws of the social world.
Within the simple understanding that relationships (as defined in networks and systems of networks) are created to advance humanity (even if at the individual nodal level) and this is the core function of the Network, you come to understand that advances in interrelationships should have as their purpose and operation the advancement of society (e.g., fulfilling the core function of the Network).
Therefore, Networkism as a state of belief will lead you to cause the components of each network to focus on furthering the core function of the Network — by making advances in interrelationships for the good of society as a whole.
By its function, Networkism should dramatically reduce rent seeking.[14] This is driven by various factors:
· Individual nodes in the Network — principally us humans — are no longer tolerating rampant rent seeking. Human behavior is shifting noticeably to require that the producers of goods and services create their products through conscientious behavior.
· The evolution of the organization type — as created and directed by us — is organizing new networks and deploying new capabilities that by their nature reduce rent seeking and enhance competition.[15]
If you understand the world as it truly exists, through a relational lens, then a new enlightened approach is to embed the advancement of humanity within your purpose as an individual. You are not an individual node maximizing your own well-being or the well-being of your close kin and associates at the expense of everyone else. You are an individual node who seeks to maximize the well-being of your network, your system, or society as a whole.
Though this conception has been embraced by special status entities like nonprofit organizations, until recently it has never been taken into the business world as a profitable strategy. It has of course been batted around for a half century under the rubric of corporate social responsibility and its related theories.
To make a higher purpose a profitable pursuit, it took the change in mindstate by select visionaries, dramatic advances in technology, and the harnessing of those technologies by these visionaries through new organizational forms that enable individuals and small collections of individuals to deploy solutions that have at their core, a transformational purpose.
And, because networks are not, and perhaps never will be, in perfect equilibrium, there are incredible gains to be made by focusing on maximizing the well-being of humanity, without engaging in rent seeking behaviors.[16] The greatest economic gains will be gained by making the greatest strides to maximizing humankind as a whole.
The evidence of the emergence of this philosophy is the sense of “purpose” that is being embedded in the new organizational types and that is a differentiating feature in the mindstate of millennials and younger generations. In addition, there are organizations that are being instituted to inculcate the minds of leaders to these profitable society-enhancing pursuits, like Singularity University and the X Prize Foundation.
Why is Networkism (or Whatever You Want to Call this new Philosophy) Such a Big Deal?
This new philosophy will unleash a torrent of change across every network and structure that we have put into place. How we view the world is the most fundamental perspective.[17] It’s the framing for everything else. It determines how economic and social systems will come into being. It will determine the mores, values, and identities of each part of the system. Therefore, a change in our most fundamental perspective is incredibly impactful:
· It has and will continue to lead to the creation of new types of organizations.
· It has and will continue to lead to the creation of new relationships between existing participants in existing networks, between existing participants and new organizations in existing networks, and between new organizations and new participants in existing networks.
· It has and will continue to lead to the creation of new networks.
· It has and will continue to unleash creative (and destructive) transformation.
Thinking about how to benefit humanity in the network to solve problems for society as a whole will lead to dramatically different ways of approaching problems, existing as well as new, and will lead to the creation of new networks, new value propositions, and new benefits and economic gain for those organizations that use the formula correctly.
Everything is subject to re-thinking, redesign, redeployment. What was never considered is now possible. Barriers are low and evaporating quickly.
This transformative change in mindstate necessitates a different approach to producing products and services. Think about the individual node level — humans — having fundamentally different mindstates in how they assess/adopt/incorporate products and services into their lives. This is the focus now with agile methodologies for product development. Though perhaps some can succeed just with this myopic focus and use of the crutch/weapon of human-centered design, it is unlikely to produce enough understanding and change across the board for proper optimization of the resources needed to succeed.
If you don’t believe that Networkism or something like it will lead us in our transformative efforts, then you will probably foresee that the dramatic transformations brought about by new technologies, or combinations of new technologies — a Fourth Industrial Revolution — will be transformative in ways similar to the previous industrial revolutions, primarily by disrupting industries and supply and demand equations, just with more scale and speed. As in, the changes are entirely defensible by (i) employing existing theories and (ii) deploying new technologies and practices.
If, however, you believe that Networkism is the leading cause for transformation, you will recognize that everything will change — every existing node in every existing network — every existing network –new nodes in existing networks — new links between new nodes and other nodes in existing networks — new networks created by new nodes creating new linkages. As you can imagine, some things will change more fundamentally than others, some by going extinct, others through transformation, and still others through creation.
Most profoundly, this shift in philosophy to Networkism will enable us to tackle the biggest challenges facing humanity using the incredible advances in technology. These include the lack of equality across a number of fields like income, education, gender, and identity. While we have seen steady gains in humanity over the last 100 years, the culmination of a new philosophical outlook harnessing new technologies through new organization types will drive forward exponential gains for humanity. Embedding this new philosophical outlook in everything we do will also ensure that we harness technology for good, protecting against the rise of evil AI and protecting good networks from wrong doers, as we always have done.
When you view the world through the perspective of Networkism, you gain an understanding of:
· the motivations of new, powerful actors in our systems;
· why these actors are so greatly impacting existing networks and the relative difficulty of entrenched network incumbents (or incumbent philosophies) to react appropriately;
· the potential impact that these actors could have in the future;
· the potential uses for technologies that would not otherwise have been considered without this new perspective; and
· the viability (and reality) of creating new networks and new systems that embody this perspective, requiring deep economic, social, political, and psychological change (all of which are already held dearly by and being pushed forward by the actors embracing and embodying this perspective).
By understanding the core functionality of the Network and observing its raw complexity, we can use this knowledge to create simple technology solutions that obtain humane outcomes and further the core functionality.
In other words, understanding the inhumanity of the network will aid us into bringing humanity into the networks in new, through profoundly better ways than past devices.
Section 3. Understanding Networks
The following section briefly describes the fundamental components of a network.
Purpose of Networks
Networks function to establish links (relationships) between nodes to transfer information or other value.
Parts of a Network
A network is comprised of nodes and links.
A node can take any form, be it a person, a corporation, a regulator, a resource, etc. One of the most important nodes in current networks, especially in financial networks, are regulators. Like rules, regulators are most typically empowered to prevent against suboptimal outcomes (state alliances to protect against evil, like the Bretton Woods System) and protect other nodes from bad actors (Geneva Conventions and banishment of slavery and prohibition of discrimination).
Links are an association or relationship between nodes. Networks are governed by “rules” of behavior — either social norms, private rules of conduct, or laws and regulations. These rules are variable depending on the rule creators intent and purpose; for instance, they can be created for exclusionary purposes as well as inclusionary purposes. In general, rules are created to protect resiliency of the networks (keep in mind resiliency is not an analog to good –Jim Crow laws is one form of exclusionary rules to ensure the resiliency of some networks at that time).
In most networks, there are network access points — these could be systems or technologies or companies. In current networks, some nodes (or network access points) are rent seekers that seek maximize gains for itself on the basis of a network inefficiency, such as imbalance in power, monopoly on a resource, or information asymmetry.
Network Inefficiencies
Networks are subject to many kinds of inefficiencies.
Information Asymmetry permits rent-seeker nodes to seek advantages for themselves (like an untrustworthy car mechanic). Rent seekers also may capitalize on information asymmetry with respect to its regulators.
Power Asymmetry has been one of the more rampant forms of network inefficiencies that lead to rent seeking. Modern forms of power asymmetry can include wealth inequality, educational inequality, or opportunity inequality.
Misalignment of Interests creates an opportunity for rent seekers and creates instability in the network.
Harmful Competition also creates network inefficiencies. For instance, traditional nation-state competition, whether hard power or soft power, often creates the construction of barriers that prevent a network from operating efficiently. Anti-competitive activities, like trusts or certain mergers, can also create these inefficiencies.
Structural Instability creates inefficient networks. Structural instability can come from social factors (like prior social practices of owning humans as chattel). Major cases of structural instability in the past have resulted from shifts in philosophical mindstates, as I described above. Structural instability also comes from shifts in power, where the newly empowered nodes create instability in the network or create new networks that destabilize the existing networks. Technological factors also unleash instability from their use in the creation of new networks (think Amazon and Uber).
Section 4. Network “Decay”
Decay is the idea that the networks that humankind have historically structured are becoming obsolete. This is the result of the inefficiencies described above eventually leading to changes in the networks and systems and the creation of new networks and systems. Another word for this is progress. I believe we are at a moment of network decay.
Historical Enablers of Network Change
Networks are historically destabilized by two fundamental factors — new organizational changes and new technologies. New organizational changes like armies, corporations, organized religion, and nation-states, have been new nodes that themselves are new types of networks, and as new nodes, disrupt existing networks, and create new networks. Technology — like agrarian, war, industrial, communication, storage technologies — enables change when it is deployed by nodes, new or existing, in existing networks, or used to create new networks. More recently, smart technologies are being deployed. In the even more recent past and in the foreseeable future, humane technology is and will be deployed.
Foundational Gains for Networks
As we have seen, new node types, new technologies, and new philosophies have been historical enablers of change that enable foundational gains for networks, which results in a substantial amount of value and wealth creation. Historically, the foundational gains are various:
· Discovery of New Resources, like the Americas
· Discovery of New Extraction Methods for Old Resources, like Energy and Financial Fees
· Discovery/Creation of New Networks, like Amazon and Facebook and Uber and Google
· Flattening/Optimization/Elimination of Old Networks, like Twitter with respect to Media Platforms or Market Place Lenders with respect to New Financing Platforms
In the future, I believe that we will see foundational gains for the Network through the creation of new networks between nodes, regulator, and rent seekers by new “enlightened” network access points. These new enlightened network access points empower nodes through technology to eliminate suboptimal outcomes, to reduce regulator burden by reducing need for regulatory protections, and by empowering regulators through technology. Our sharing economies have been created by enlightened network access points.
In addition, enlightened technology empowers people to protect and benefit themselves against abusive practices by network nodes (think ad blockers and data privacy technologies). The concept of enlightened technology is needed precisely to combat deployment of abusive technology, because the ability to be abusive is also empowered by technology.
Section 5. A New Organizational Type
I want to explain where I think the future of organization will go under Networkism.
All networks are fundamentally “social” networks and all networks are by their nature “inhumane”. Currently, the “owners” or “successful” participant nodes in the networks are cold, analytical rent seekers or those that take advantage of innovations/information asymmetries/little known network dynamics. These rent seekers utilize harmful “heartless” innovations to succeed.
Earlier I explained how new organizations are being created around a purpose that is big and transformative. But these formulations are purpose-agnostic. They just require that the purpose be huge and aspirational and guiding. These formulations could describe the rise of well-purposed organizations just as much as bad-purposed organizations (like one that, for example, aims to control the extraction of all the copper resources of the world).
New networks are being built by these new purpose-driven organizations through technologies to empower people. I refer to these as beneficial “heartless” innovations. Think Amazon, with its cold analytical focus on consumer needs. You also have beneficial “fictionally hearted” innovations, like Facebook and new media technology platforms that fictionalize experience and seem to show “heart”, but who focus more on problems like how to break up with a partner efficiently instead of creating tools to harness interests and social dialogue to further humanity (like a platform for making micropayments to vetted charities that are fighting to assist the social issue that Facebook users are passively watching and accelerating through abundant likes).
The future of organization under Networkism is the “True-Hearted Organization.”[18] A true-hearted organization has the DNA of an exponential/teal/conscious/digital organization but overlays a humane purpose onto its massive transformational purpose. The gravitational focus of the organization then moves from the higher cognitive calling of the brain of the organization — the massive transformational purpose — to the heart to the organization — the humane purpose.
These humane purpose driven organizations will use a complete and utter focus on the needs of people to protection them from other network participants through technology (offensive defense) through the creation of new networks that will introduce and safeguard humanity in the networks by embedding humanity in their modus operandi, technology, and network rules.
This humane purpose ensures that these new organizations are not rent seekers and that they create new networks or disrupt existing networks away from their control by incumbent or emerging rent seekers. This ensures that rent seekers will be marginalized and a new world order will emerge where society at large improves by willful intent (rather than through the trickling down of benefits).
So, you might be wondering whether this mean that corporations have feelings too. Yes, that is it exactly — that is part of this new form of an organization. Corporations already have personhood. So why not embed them with a personality — a good heart?
A corporate filing just a piece of paper, a registration. It is not as though registering with DMV means your identity is a “Motor Vehicle Administrator”. So why would a c-corp designation mean anything in particular or prevent you from being a true-hearted organization.
Your workforce creates the personhood in the corporation. Culture is paramount. Start-up technologies that assess you in hiring good culture matches are a great innovation.
Customer interactions are how a corporation expresses its feelings — this is its DNA expressed in interactions. Yes I can help you with anything you need. We’re so sorry to hear about your troubles and we’ll take care of you right away. We care. We mean it.
The experience of using the product or service is just one metric — can you feel the humanity of the heart that created all this? Can you see and feel and believe how in using this product and service, you are doing good as well? The good the true-hearted organization creates is the other metric. It should be measurable in some way.
Section 6. The Rise of a New Economy
With the leadership of true-hearted organizations and their visionaries using this new philosophical outlook to guide their behavior, I believe we are entering into new kind of economy, what I call a Conscious Economy.
Recall that the goal of Networkism is, simply put, the advancement of humanity. The emerging Conscious Economy is being created by True-Hearted Organizations embed goodness in the DNA of technology and networks, and make sure that we kill bad technologies’ by denying them access to good networks.
In this economy, a true-hearted organization seeks to provide a humane outcome that is indistinguishable (i.e., cannot be removed) from the product or service that it provides. It aims to benefit society at large. This type of economy is distinguishable from the experience economy because it firmly embeds the individual purchaser or user of the product or service as an actor in the network in which that particular conscious business operates. That is, by using the good or service, the individual directly participates in the achievement of a humane outcome — the individual is no longer a passive taker, it is also a giver. This phenomenon reflects a true alignment of interests across parts of the network and among the networks that are embodied in the economy. It creates a new ecosystem of humane outcomes.
Insincere organizations and their networks will falter and fail with the rise of true-hearted networks led by true-hearted organizations, which will expose insincere companies and networks as inauthentic. Certainly, insincere companies and their networks can find and embed their humanity in every part of its networks, but the pivot will be hard and painful.
Section 7. Putting Networkism to Use
How to Use Networkism to Further your Thinking
We need to use Network visualization to enhance our understanding of the networks in which we operate.
Thinking through the perspective of networks allows you to see the big picture and allows you to bend your vision around the next corner. But in order to see the big picture, you have to understand the parts of the systems and networks, and the dynamics between those parts. While going through the major networks is a helpful perspective, most industries are comprised of a highly complex system of networks, and the ability to use this philosophical perspective to your benefit surely entails a deep understanding of this and the role you would force your organization to play.
I think we need to focus on the network that we are operating within. What does the network for each of our products and services look like? How has it changed over time? How are new entrants (especially those new organization types) interacting with existing networks? What new networks have been created? What is the behavior of the nodes throughout this all? Only then can we properly understand the complexity of the issues and the magnitude that the change of the philosophical mindstate should have on our own thinking and product processes.
Relating Networkism to Future Thinking
We should connect Networkism to future thinking.
You can see Networkism as a way of thinking that is an important precontext for future thinking. For me, the two work in concert. Future thinking projects forward through rational, deductive reasoning and application of a very creative mind to the constituent parts and, how these parts will be brought together in the future and to what end (See Frank Diana and Gerd Leonhard). Both future thinking and networkism entail envisioning the future you want. Future thinking helps you to rise above small thinking so you can identify and then create big, impactful changes. Networkism permits you to see the roadmap to execute your big impactful changes, or, if you see the world negatively, for how to survive the incredible transformations taking place. Future thinking is almost invariably an individual or small group effort — how executives at Ford can envision the future and how to translate that vision into action. Networkism is a collective psychological or philosophical shift in how we view the world and is more of a how to than a what or a where.
Translating Networkism to the Future of Regulation
The rise of new networks, whether led by new or established technology companies, will be most challenging for legal and regulatory structures. Success in this new paradigm requires a substantial rewriting of the existing networks and a substantial rewriting or redeployment of the regulatory systems that are employed to protect people and other nodes.
Whether and how legal and regulatory systems can keep up with the advances in technology and the creation of new networks will be foundational in the progress that these new organizational types are permitted to make.
Regulators trust their understanding of the networks. They are not entrenching interests by design nor is this indicative of regulatory capture. But, this entrenchment of understanding operates in the same way as if there were regulatory capture. Regulators will have difficulty embracing changes to the networks or embracing the establishment of new networks, particularly when old networks are collapsing. This is true even if the changes are being brought to bear by an existing incumbent, and especially if the incumbent is transforming into the new form of organization with a humane massively transformative purpose.
There is a substantial amount of work needed by new and established companies to ensure that the regulatory systems can accommodate the new networks and enable the companies harnessing these new networks to succeed, to the benefit of the network as a whole (including the regulators).[19]
To explore these issues and push forward solutions to these challenges, I have begun a series of insights on the regulation of financial technology, called REFIT.
In REFIT, I will explore recent regulatory paradigm shifts, enhancements to the regulatory agenda, like regulatory innovation offices, and regulatory perspectives on new financial technology, like big data, privacy, marketplace lending, and emerging payments technologies.
Stay tuned.
One can never consent to creep when one feels an impulse to soar.”
— Helen Keller, writer and political activist
Appendix A — Networks throughout History
I want to take stock of some networks and systems and their attributes to demonstrate how Networkism ties together the building blocks described above to unleash profound changes. In doing so, I want to lay out examples to show how this thesis works in practice.
All Networks are Social Networks
The first and most important point is that all networks are fundamentally social networks, from time immemorial to today’s large scale communication technologies.
Sociological Networks
Let’s start with traditional sociological networks.
Kinship based networks, including immediate family units, extended family networks, tribal units, and systems of tribal units, persisted for much of human history. At inception, these were created to aid in human survival and, as survival was more or less secure, morphed into networks for human progress.
Then, the invention of Agriculture in the Neolithic Revolution — First Agricultural Revolution — enabled the creation of new networks, which fundamentally altered the course of humanity, leading to a faster rate of progress in humanity.
The agricultural revolution unleashed transformative potential — this was used to create new networks that were not fundamentally at odd with the old networks in the places they existed, but rather, could absorb them. Towns, Cities, City-states, and Nation-states — all new ways to organize socially — rose from the seeds of the agricultural revolution. Other forms of social networks also arose from that revolutionary event, primarily the army, church, education, trading enterprises, banking, corporations, and civil society enterprises.
These new networks though were used to harness power to destroy other clans (competing networks), especially of those who had not yet adopted the new technologies and social structures, or done so less effectively.
Corporations
Because of my particular concern on how Networkism applies to modern business, I focus on for-profit corporations, which have gone through various forms of change. Corporations are themselves a social network, comprised of individuals collectively pursuing a shared goal (the word corporation comes from the Latin word for corpus — a body — as in a body of people).
Corporations have both dramatically changed the Network as the network node that has effected the most change in existing networks and the creation of new networks from scratch, as well as themselves becoming the most productive form of a network in modern history. Keep in mind that corporations are themselves a network.
Initially, corporations in the Western world were governed through royal authority granted from the state to the enterprise, which was a sort of devolution of the authority granted to the state by the divine right of kings.
The liberation of the corporation resulted from the robust combination of the technologies unleashed in the First Industrial Revolution, the shift in political philosophy to the Individual as expressed by Immanuel Kant and others, and the shift in political ideology away from government ordained by the divine to government by the people for the people as expressed by Thomas Paine and others.
The loss of divine control over corporations and the independence granted to engage in their most profitable pursuits unleashed corporations to leverage new advancements in technology. This as we know, led corporations to their current nadir.
The modern for-profit corporation, as we know it, is itself a complex network. Public corporations are owned by a diverse network of shareholders, some of which are a networks of networks, all created to facilitate the movement of capital for investment and gains, and has as its central purpose the maximization of profit for these shareholders. Large corporations historically employ a large number of employees, usually own vast amounts of fixed assets, usually consume large amount of goods and services from other parties, and usually embed other goods and services into their own products and services.
As noted above, the rise of purpose-driven organizations in the new experience economy is putting pressure on the modern for profit corporation’s reason for being, and new forms of corporation, like the B-Corporation are being established to accommodate more goals than just shareholder profit maximization.
These corporations are no longer employing large numbers of employees, no longer owning vast amounts of fixed assets, no longer holding as their core and sole purpose the profit to shareholders, and instead adopting a transformational purpose as its goal.
We are now seeing another transformation where corporations will go back to their initial formulation as a network that collects individuals (and assets) in order to achieve a shared goal, with that goal leading to the natural consequence of shareholder profit maximization.
Communication Networks
The act of communicating is fundamental to our being human and it is no surprise that communication networks have always been central to advancements in humankind’s prosperity.
Human history has seen the evolution from long distance communication by verbal couriers, to written letters,[20] to telegrams, to the telephone, to the internet, to the mobile technologies, to new social networks like Facebook and Twitter. In each case, the transformative technology established new networks from scratch and enabled new connections between network nodes that otherwise were not possible.
A Facebook User Network
A Twitter Celebrity Network
Systems of Economic Organizations
Systems of economic organization are more important than communication networks for most innovators today (though modern communication networks are absolutely invaluable channels for marketing and advertising these innovators’ products and services and achieving success).
Supply and Demand for Labor
Networks of supply and demand for labor are the earliest forms of economic organization.
In early human history, these kinship networks ensured survival of the individual and the family, by organizational structures that required labor to be provided to fulfill the demands of survival. Each family network was led by familial heads, men in patriarchal societies and women in matriarchal societies, and each kinship network composed of family networks generally was commanded by elders.
“State” Networks.[21] The first profound world philosophy — the Philosophy of God — came out of the agricultural revolution, which enabled humans to shift their goal from survival to prosperity. This philosophy created more complex economic networks where the demand was largely driven by prosperity in the name of God (i.e., resource maximization for those ordained to act on God’s behalf) and labor was provided to supply the inputs for this prosperity. Think feudalism, crusades, and imperialism.
“Individual” Networks. The second profound world philosophy, the Philosophy of Individualism, broke the monopoly on God. This philosophy was driven by thinking from Renee Descartes and Immanuel Kant and provisioned by technological progress like the printing press. The rise of individual (be they corporate or natural persons) shifted the goal to individual prosperity and enabled the creation of new and unique social economic networks in pursuit of that goal. The demand side was opened up to pursue prosperity and joint stock corporations flourished. Social innovations like the banishment of slavery and the unionization under labor movements disrupted the supply side and changed the nature of the existing networks (as well as creating new networks and new network nodes, such as the worker cooperative). Other social protections established through legislation required further changes to the networks for the supply and demand of labor.
Gig Networks. Now, the third philosophical shift to Networkism is leading to the creation of on-demand gig networks by mission-led companies using technology platforms to create completely new supply and demand networks from scratch, bypassing the old networks. They do this by creating new relationships among the nodes in existing networks. Uber is the poster child here.
Regulators are key actors here to ensure that the labor networks do not operate in harmful ways to individual nodes or across the networks and systems. Obviously, with respect to the new on-demand gig networks, regulators are severely challenged, as these new networks disrupt existing networks, displace existing incumbent actors in those networks, and upend the consistent and linear progress that has been made in labor markets and social protections over the past century. Regulatory concerns are rampant in spite of any clear indication or understanding as to whether these new networks truly create any significant issues for the supply or demand of labor in these networks. Moreover, the benefits that the new on-demand gig networks create are probably not yet commonly understood or appreciated: for the supply side of labor, in the freedom that these new networks provide from the monopolization of supply by corporations; and for the demand side of labor, in the exponential gains obtained at the individual consumer level in availability of labor services, pricing, and transparency, and the breaking of monopoly/trust behaviors that have been exhibited by taxicab networks in U.S. cities and which have frequently been a subject for popular scorn and calls for reform (here in D.C., it is easy to remember the days of cabs crossing zones to increase fares, refusing credit card terminals, and refusing to provide change).
Supply and Demand for Goods and Services
The supply and demand for goods and services can be observed as its own network. This network also obviously interacts with other networks, like those that serve the supply and demand for labor.
I count four major “phases” of networks for the supply and demand for goods and services. These are commonly referred to in the historical literature as “economies”. I’ll continue that reference here, but know in my heart I bristle at not calling these networks or systems.
The first scalable economy was the Agrarian Economy that specialized in the trading of commodities by commodity businesses. Commodity businesses charge for undifferentiated products (e.g., rice). These businesses began as local businesses and the British and Irish Agricultural Revolutions enabled methods of production that resulted in national agrarian economies, with further advancements enabling international agrarian economies.
The Industrial Economy facilitates the trading of goods by goods businesses, which charge for distinctive, tangible things. These also began primarily as local economies through hand production and migrated to national economies through machine production in the First Industrial Revolution. Subsequent industrial revolutions enabled the internationalization of industrial economies. New technologies emerging in the post-war 1950s enabled the start of individual task automation. The industrial revolution and the more sophisticated industrial economies that came out of it, as mentioned above, were driven by the philosophical change from the Philosophy of God to the Philosophy of the Individual.
The trading of services in a Service Economy has been a longstanding but mostly local affair. The modern services economy emerged as a national and then global economy to enable services businesses to charge for the performance of activities.
The Experience Economy is a more recent innovation whereby an experience business implements in its products or services a particular feeling that it wishes to provide a customer, which is in addition to the underlying product or service. The green revolution and corporate social responsibility emerged in the experience economy. Most of the new technology companies, technology platforms and social networks are embedded in the experience economy. These can be a local, national, or global economy.
Regulators are key actors here to ensure that the products and services are not tainted, harmful, misleading, unlawful, deceitful, etc.
Supply and Demand for Money
To not belabor the main points of discussion, I wanted to address the supply and demand from a high level. The types of money networks that have existed over time are:
State — State networks. In this respect, by state could mean kingdom, fiefdom, city or city-state as well as nation-state. This is usually accomplished by the dominance of one of the states over the other.
People — State networks. This is phenomenon in the past of coercion and in the present of safekeeping of assets.
State — Privateer networks. These are networks where states financed privateers on state-sponsored missions (think the Spanish conquistadores; the companies that colonized North America, the Medici bank). These networks continue in existence with state-owned enterprises or sovereign wealth funds. These “privateers” of course participate in other networks, be they in the supply and demand for money or in the supply and demand for goods, or some other social enterprise.
Private Bank-Corporation networks. With the advent of private banks, these networks emerged as financing devices for corporations and, of course, continue in existence as commercial banking.
Bank — Bank networks. These are networks that exist at the central bank, private bank, and inter-state bank levels.
Private Banks — People networks. This is now referred to as retail banking, with a new and intense focus on consumer protection.
People — Private Bank networks. These networks consist traditionally of deposits and retail non-deposit products. Past failures in these networks in the 1920s gave rise to deposit insurance and modern banking regulation.
People — Business networks. These networks consist of the individual financing of business enterprises (such as by purchasing stock). Failures in, again, the 1920s, led to modern securities regulation.
Business — Business networks. These networks also consist of the financing of business enterprises but are through both loan funding as well as stock purchases. Securities regulation is largely focused on investor protections, which in most traditional structures, is limited to business investors.
Business — People networks. These networks employed traditional storefront models, with new digital models taking their place, such as marketplace lenders and payments system innovations. These new form of networks bring forward both consumer protection as well as investor protection issues (that combination has not been seen before).
People — People networks. This is the network that is the traditional money changer operating in the main square, or in or near the temple grounds, consisting of single individuals or associations of individuals. In modern times, new crowd funding platforms, marketplace lenders, blockchain and other cryptocurrency protocols, and other payments system innovators (e.g., Venmo), permit new people to people financing networks. There is of course a focus on consumer protection in these networks.
Regulators are key actors here to ensure the safety and soundness of individual nodes as well as the safety and soundness of the networks and systems.
Appendix B — The Views of Other Disciplines Embracing Relativism
This section illuminates other perspectives that support the Philosophy of Networks by embracing relativism in their disciplines.
Network science is a new and emerging discipline that is rooted in the discovery that “[b]ehind each complex system, there is an intricate network that encodes the interactions between the system’s components” and that “despite the apparent differences, the emergence and evolution of different networks is driven by a common set of fundamental laws and reproducible mechanism.”[22]
Relativity in Physics is the observation of relational qualities among physical substances — in observing something, it is defined by its relationship to other things; also, in observing it, you are defining it.[23]
Both Einstein’s theory of relativity and experiments in quantum physics profoundly shook up the foundations of classical science.
The ‘world out there’ was no longer seen as separate and distinct from the world within the individual. There was an interconnectedness among all phenomena.
Einstein wrote:
“A human being is part of the whole, called by us ‘Universe’; a part limited in time and space. He experiences himself, his thoughts and feelings as something separated from the rest — a kind of optical delusion of his consciousness. This delusion is a kind of prison for us, restricting us to our personal desires and affection for a few persons nearest us. Our task must be to free ourselves from this prison by widening our circle of compassion to embrace all living creatures and the whole nature in its beauty. Nobody is able to achieve this completely but striving for such achievement is, in itself, a part of the liberation and a foundation for inner security.”[24]
Relativity in Philosophy, “roughly put, is the view that truth and falsity, right and wrong, standards of reasoning, and procedures of justification are products of differing conventions and frameworks of assessment and that their authority is confined to the context giving rise to them.”[25]
Relativity in Religion has a long history of relativity that posits that we are all connected by something, which I equate to oneness or consciousness.
Hinduism is a broad collection of related religious philosophies, but they all believe in Brahman, which is a unifying force that pervades everything.
“All speech, action, and behavior are fluctuations of consciousness. All life emerges from, and is sustained in, consciousness. The whole universe is the expression of consciousness. The reality of the universe is one unbounded ocean of consciousness in motion.”[27]
Buddhism does not support the Hindu concepts of Brahman (and the corresponding Atman) but do hold a corresponding view of Hindu’s version of Nirvana, which in Buddhist theology is the extinction of the fires of suffering. One way that some Buddhist scholars have described this extinguished state in Buddhism is as “consciousness without feature, without end, luminous all around.”[28]
The Buddhist principle of the oneness of self and environment (esho funi) means that life (sho) and its environment (e) are inseparable (funi). Funi means “two but not two.” This means that although we perceive things around us as separate from us, there is a dimension of our lives that is one with the universe. At the most fundamental level of life itself, there is no separation between ourselves and the environment.[29]
Buddhism teaches that all life is interrelated. Through the concept of “dependent origination,” it holds that nothing exists in isolation, independent of other life. The Japanese term for dependent origination isengi, literally “arising in relation.” In other words, all beings and phenomena exist or occur only because of their relationship with other beings or phenomena. Everything in the world comes into existence in response to causes and conditions. Nothing can exist in absolute independence of other things or arise of its own accord.
Shakyamuni used the image of two bundles of reeds leaning against each other to explain this deep interconnectedness. He described how the two bundles of reeds can remain standing as long as they lean against each other. In the same way, because this exists, that exists, and because that exists, this exists. If one of the two bundles is removed, then the other will fall. Similarly, without this existence, that cannot exist, and without that existence, this cannot exist.
More specifically, Buddhism teaches that our lives are constantly developing in a dynamic way, in a synergy of the internal causes within our own life (our personality, experiences, outlook on life and so on) and the external conditions and relations around us. Each individual existence contributes to creating the environment which sustains all other existences. All things, mutually supportive and related, form a living cosmos, a single living whole.
When we realize the extent of the myriad interconnections which link us to all other life, we realize that our existence only becomes meaningful through interaction with, and in relation to, others. By engaging ourselves with others, our identity is developed, established and enhanced. We then understand that it is impossible to build our own happiness on the unhappiness of others. We also see that our constructive actions affect the world around us. And, as Nichiren wrote, “If you light a lamp for another, your own way will be lit.”[30]
The Abrahamic religions — Judaism, Islam, and Christianity — are all monotheistic religions that believe in the oneness of a single cause of all creation, which connects all living things to each other.
All these scientific, philosophical, and religious theories embrace relativity and share foundational similarities.
· Everything is interconnected
· Individuality is an illusion
· Relationships are what exist[31]
· The ultimate level of reality is not observable[32]
The Importance of the Brain and Perception
Neuroscientists studying the brain are at the forefront of understanding perception.
We understand that the brain is incredibly complex (20 billion neurological connections!). In a cubic centimeter of brain tissue there are as many connections as there are stars in the Milky Way Galaxy.
We know learning is the result of the brain’s creation of new neurological connections. We also know that neurological connections can decay — we can forget. Yet, we presently know very little about the brain. We’ve never mapped an entire brain before though that project is underway. As we learn more about how the brain works and how to design systems to function like the brain, machine learning and deep learning solutions, which are patterned on the brain’s functioning, will become more advanced.
We also understand that perception is complex and that illusions come from within the brain.
For example, we generally think of “seeing” as the result of processing information that comes through our eyes, but the truth is that several times more of what we “see” consists of information produced within the brain. All of us carry around internal models that the brain uses to construct, from endless perceptual fragments, what we call reality. In other words, much of what we experience of reality is, in Eagleman’s words, a “beautifully rendered simulation.”[33]
The dynamics of perception and behavior are now being more scientifically assessed through advances in behavioral psychology and behavioral economics. These disciplines have supported breakthroughs in the design of products and services, particularly digital products and services, because they have been embedded in human-centered design theory. Our continuing study and understanding of the brain will continue to enable new and profound innovation and progress in our development of products and services.
But, we must beware. Because of cognitive biases and the ability to use our learnings in behavioral psychology and behavioral economics to our advantage, we must ensure that the system does not tolerate abuse of that knowledge or wrongful application of those learnings to develop abusive technologies or deploy technologies in an abusive manner. In other words, we must embed in our technologies, networks, and systems, protections from abusive nodes.
I place my hope and expectation on this in the new generations of conscious individuals, who are organizing true-hearted organizations in the emerging Conscious Economy under a Philosophy of Networkism.
Appendix C — Information, Marketing and Advertising Networks
Information, marketing and advertising networks because these are networks are changing constantly and the emerging Conscious Economy and Networkism will guide these networks to greener pastures.
The advertising of the past and present was and continues to be an experience where you are sold products and services. You are passive and you have the choice to believe what you were being told, to try to substantiate it, or to not believe it, in which case you would either acquire the product or service or decline the offer.
Advertising has emerged out of product design. A business intent to create a new product or service, or meet goals on an existing product or service, might result in advertising that is intended to ensure adoption of the product or service or meet the business-defined sales goals. This kind of product development and advertising practices is what created a large number of consent orders in the banking industry under the unfair, deceptive, acts and practices claims.
But, advertising is changing now at the margins because the development of products is changing. Human-centered design is aligning interests between the users of a product or service and its developers. Whereby before profit and loss statements drove the construction of products and their advertisement, products and services designed with human-centered design principles are take into account the user’s interests and needs. Being fundamentally rooted in behavioral psychology, there exists the potential to misuse the power of human-centered design to incorporate behavioral triggers that do not fundamentally benefit the user. But, assuming that is not the case, the advertising of a human-centered designed product or service should be more natural and, rather than pushing the sale of the product or service, advertising can show its benefits to the user, and be embedded in native (but still clearly advertising) environments to interact with the user without being sales-y.
New technology enables us to access an insane number of choices. Technology platforms that act as funnels for information enable us to make sense of the choices and access them. These technology platforms are naturally the new advertising channels.
True-hearted organizations must provide controls to ensure that third party advertising meets the DNA of the true hearted organization. Fundamentally, to be successful advertisers now and in a Conscious Economy, these technology platforms have to be brokers in trust and privacy.
Take Google as an example. Its search engine produces trusted results. If a company obtains better search rankings through gaming, that company gets punished by Google because Google needs its results to be trustworthy to retain its value.
However, the trust in privacy is not there and the lack of privacy in interactions with Google causes some to neglect to use Google’s products and services.
Tracking in the internet and mobile environment today is the wild west. Consider the analog version of what’s going on out there. You walk down a street. A man takes note of your coming in a notebook and documents what he believes he knows about you in terms of age, education, salary, family status, brand preference, etc. You walk into a store and look at a few items but leave without buying them. Someone in the store takes note of your every movement. You leave and have lunch. Someone in the restaurant comes up to you and starts showing you advertisements of the items you just looked at in the store. You are not interested and eat instead. At the end of your meal, with your bill, there is an advertisement for a new version of the handbag that you are carrying. You pay your bill and leave.
Sure, there are consumer benefits in targeted advertising. But, is the exchange of privacy for benefits understood by consumers and agreed to or is this a practice of adhesion? I believe the practices that are prevalent today is are at their nadir and that we’ll see improved practices, more widespread availability and deployment of new protective technologies like ad blockers, and more proactive regulation and regulatory scrutiny.
Research is showing that Millenials and younger generations dislike traditional advertising.[34] I believe the future of advertising is to disappear advertising behind the scenes (much like Uber disappears payments behind the scenes). Generally, then, this means that advertising will still exist in a meaningful and robust way, but the specifics will be on stand-by to be employed at the direction of the user.
In that respect, a true-hearted organization could be a service to enable a user to finds products that meet X,Y, and Z attributes, and at the user’s direction, the user further explores these products, including, among other things, the company’s description of the product. More fundamentally, the look feel of the product and how the user first encounters the product (image, description) in this kind of service will be a paramount consideration for whether the user will go deeper into that product. The advertiser will control the initial encounter and the details on the user-instituted deep dive. The true hearted organization will control the terms and conditions of the network / platform that the organization created, in which the advertiser operates to get in front of consumers.
[1] http://www.kurzweilai.net/the-law-of-accelerating-returns
[2] https://www.google.com/search?q=In+10+years%2C+40%25+of+the+Fortune+500+will+go+out+of+business&oq=In+10+years%2C+40%25+of+the+Fortune+500+will+go+out+of+business&aqs=chrome..69i57.315j0j7&sourceid=chrome&es_sm=122&ie=UTF-8
[3] http://faculty.wcas.northwestern.edu/~jmokyr/Florence-Weber.PDF
[4] http://www3.weforum.org/docs/WEF_GAC15_Technological_Tipping_Points_report_2015.pdf https://agenda.weforum.org/2015/12/the-fourth-industrial-revolution-what-it-means-and-how-to-respond/
http://dupress.com/articles/heros-journey-landscape-future/
http://dupress.com/articles/tech-trends-2015-exponential-technologies/
[5] https://www.ideo.com/work/human-centered-design-toolkit/
[6] While we have seen the emergence of these types of companies based on core philosophies, we also see these companies emerge from social legislation. See http://www.pymnts.com/in-depth/2015/a-startup-to-save-retails-supply-chain-soul/.
[7] http://techcrunch.com/2015/11/08/silicon-valley-represents-an-entirely-new-political-category/
[8] The suffix –ism means “a distinctive practice, system, or philosophy, typically a political ideology or an artistic movement.”
[9] Just as technological changes enabled the earlier shifts in world philosophy, so do technological changes enable the current shift. Networks, and especially our new social technology networks, enable this shift — see republic of letters http://republicofletters.stanford.edu/index.html.
[10] When we said the Individual exists, we didn’t then go on to say, therefore, this means God does not exist. Just in the same way, we wouldn’t say that the Network exists and therefore the Individual does not exist. Rather, we say, God, the Individual, and the Network have always existed. We can see that life isn’t about God’s control of the world, nor is life solely about the self-rule of Individuals. Counterintuitively, the shift to the relational actually brings more power to individual persons, not less.
[11] There are so many elements of prior philosophers and religions and beliefs that could be read as embracing Networkism. Only, they were before their time and existed in profoundly different world philosophies and so, though they are consistent with Networkism, they are not congruent with Networkism, as they largely emerged against earlier philosophies than what Networkism is emerging from.
[12] Rent seeking is defined as when a company, organization or individual uses their resources to obtain an economic gain from others without reciprocating any benefits back to society. Networks, especially bad networks, take exceptional effort to change or eliminate. But, somehow, despite bad actors and bad networks, the Network (the totality of the systems and networks) has always functioned to advance humankind and defeat threats to humanity. The Network is always advancing humanity in some way, at least over the long term, despite the inhumane outcomes that have persisted in history, which are largely born in the indiscriminate rent seeking on account of the earlier philosophies. That is the beauty and mystery of the Network.
[13] See Philosophy of The Industrial Revolution.
[14] But, that does not mean that Networkism equates to socialism or any theories that require equal distribution of resources, for it is merely a philosophy of the mind, and not of any social or political system. In that respect, there will always be winners and losers, companies and nodes who use resources better than others and whose innovations are more valuable than others, and so are compensated accordingly.
[15] http://www.project-disco.org/competition/081513-rent-seeking-and-the-internet-economy-part-1-why-is-the-internet-so-frequently-the-target-of-rent-seekers/#.VqD7F_mEn3U
[16] I believe that the natural progression of networks is always, blindly, to find equilibrium, which I define as a state where there is no potential for rent seeking by individual nodes.
[17] http://faculty.wcas.northwestern.edu/~jmokyr/Florence-Weber.PDF
http://www.wadsworth.com/philosophy_d/special_features/timeline/ind_rev_timeline.html
[18] One for one companies that aren’t faking it have been at the forefront of this movement. http://smartycents.com/articles/10-one-for-one-companies/
[19] http://venturebeat.com/2013/06/25/strangling-innovation-tesla-versus-rent-seekers/
[20] Republic of Letters (http://republicofletters.stanford.edu/index.html)
China Biographical Database Project — Social Networks Database (http://isites.harvard.edu/icb/icb.do?keyword=k16229&pageid=icb.page499251)
[21] By “state” I refer to kingdoms, city-states, nations, or any actor that had near total control over labor resources on the account of divine right.
[22] Per Wikipedia: Network science is an academic field which studies complex networks such as telecommunication networks, computer networks,biological networks, cognitive and semantic networks, and social networks, considering distinct elements or actors represented bynodes (or vertices) and the connections between the elements or actors as links (or edges). https://en.wikipedia.org/wiki/Network_science
http://barabasilab.neu.edu/networksciencebook/download/network_science_November_Ch1_2012.pdf
[23] http://www.physicsoftheuniverse.com/topics_relativity_general.html
[24] http://www.buddhism-and-the-american-dream.com/?p=491
[25] http://plato.stanford.edu/entries/relativism/
[26] https://en.wikipedia.org/wiki/Brahman; citing James Lochtefeld, Brahman, The Illustrated Encyclopedia of Hinduism, Vol. 1: A–M, Rosen Publishing. ISBN 978–0823931798, page 122
[27] MM Yogi.
[28] Thanissaro Bhikkhu, Access to Insight: Readings in Theravada Buddhism.; Peter Harvey, Consciousness mysticism in the discourses of the Buddha. in Karel Werner, The Yogi and the Mystic; Studies in Indian and Comparative Mysticism.” Routledge, 1995, page 82; books.google.com.
[29] http://www.sgi.org/about-us/buddhism-in-daily-life/oneness-of-self-and-environment.html
[30] http://www.sgi.org/about-us/buddhism-in-daily-life/interconnectedness.html
[31] All particles and matter relate — I heard it said that all matter fits within a pea if you collapsed the “spaces” between them. So, the spaces are the biggest things in the universe. What are those spaces other than the links between nodes or the fabric that relates matter together?
[32] In other words, we only have our sense organs to seek the infinite and this is like trying to go to the moon with a pull cart — this is the problem of humanity. Fundamentally, I believe that the Philosophy of Networkism is the Philosophy of God but with the Individual at its core. New technologies and the advancements made by human progress to date now enable individuals maximum freedom to enhance consciousness and humanity and benefit the whole (i.e., serve God) without having the control structures from millennia ago imposed on them in order to do so. It is a bottom up and not top down but it has at its core, the same purpose — advance humanity. I believe that in our ancient religions, it was always this way. We just lacked empowerment at the individual level, we lacked individual consciousness, and we lacked an ability to stop rent seeking in the networks. Now we have all three coming together with the relational.
[33] http://www.forbes.com/sites/daviddisalvo/2015/10/13/the-cosmos-inside-your-head-neuroscientist-david-eagleman-tells-the-story-of-the-brain-on-pbs/#2715e4857a0b5f147c65f2de
[34] http://www.forbes.com/sites/danielnewman/2015/04/28/research-shows-millennials-dont-respond-to-ads/#2715e4857a0b3fff18735599
