The Multinational’s Nemesis ----- The rise of ICT-enabled distributed collective intelligence? Monday, December 15, 2008 Panel #3, 16:00 to 17:30 Chair: Johan Gorecki, Globe Forum Business Network, Sweden Panelists: Pierre Berthon, Bentley University, USA Philip DesAuthels, Microsoft, USA Brian Donnellan, National University of Ireland – Galway, Ireland Robin Teigland, Stockholm School of Economics, Sweden

Panel overview Introduction Johan Gorecki ICT – enabled distributed collective intelligence Pierre Berthon Philip DesAutels The Multinational Corporation Brian Donnellan Robin Teigland Discussion with audience

Introduction

Johan Gorecki

ICT – enabled distributed collective intelligence

Pierre Berthon

Philip DesAutels

The Multinational Corporation

Brian Donnellan

Robin Teigland

Discussion with audience

Johan Gorecki Founder and CEO Globe Forum, www.globeforum.com Modern Times Group (MTG), where responsible for Metro and Everyday One of Skype cofounders

Introduction Are ICT-enabled distributed collective intelligence organizations challenging the MNC as the superior organizing form? As efficient and effective at enabling coordinated action ? As superior in facilitating social community ? As more effective as driver of social change ?

Are ICT-enabled distributed collective intelligence organizations challenging the MNC as the superior organizing form?

As efficient and effective at enabling coordinated action ?

As superior in facilitating social community ?

As more effective as driver of social change ?

Skype Launched in August 2003 Q1 2006 95 million users Q 3 2007 246 million users 6.1 billion minutes Avg 12 million active users 2005 sold to ebay for €1.9 billion

Launched in August 2003

Q1 2006 95 million users

Q 3 2007 246 million users

6.1 billion minutes

Avg 12 million active users

2005 sold to ebay for €1.9 billion

Globe Forum (www.globeforum.com)

MyC4

Microfinancing: Kiva.org

Total capital raised from Kiva internet lenders ($USD mln ) More than USD 13 million raised from 133,000 social investors in 25 months

Own experience, own reflections Time to market Keep the smart people Globalisation Fast communication Integrate in the community Pick up trends Environmental issues

Time to market

Keep the smart people

Globalisation

Fast communication

Integrate in the community

Pick up trends

Environmental issues

Panel overview Introduction Johan Gorecki ICT – enabled distributed collective intelligence Pierre Berthon Philip DesAutels The Multinational Corporation Brian Donnellan Robin Teigland Discussion with audience

Introduction

Johan Gorecki

ICT – enabled distributed collective intelligence

Pierre Berthon

Philip DesAutels

The Multinational Corporation

Brian Donnellan

Robin Teigland

Discussion with audience

Pierre Berthon Clifford F Youse Chair of Marketing Professor Bentley University Philip’s supervisor

Clifford F Youse Chair of Marketing Professor

Bentley University

Philip’s supervisor

PhD candidate at Bentley University US manager of academic evangelism at Microsoft Research interests in generative social enterprise Philip DesAutels

ICT-enabled distributed collective intelligence

Why is the open model more appropriate today?

Requisite variety is ever increasing There is more turbulence - Socially, economically, environmentally, technologically. Traditional mechanistic/heir approach to organizations is not able to cope. Governments – Nationalization E-government Social enterprises

Requisite variety is ever increasing

There is more turbulence - Socially, economically, environmentally, technologically.

Traditional mechanistic/heir approach to organizations is not able to cope.

Governments –

Nationalization

E-government

Social enterprises

Previous generations were born into hierarchy Family Schools Society Work Religion Gen-Y Connected – born digital Autonomous – latchkey, make their own decisions, forced Multitasking

Previous generations were born into hierarchy

Family

Schools

Society

Work

Religion

Gen-Y

Connected – born digital

Autonomous – latchkey, make their own decisions, forced

Multitasking

Why do organizations fail? Your business is as complex as a bowl of noodles.

iPhone 99¢

Dove Real Beauty Real Beauty Movement online community Facebook BBS

Real Beauty Movement online community

Facebook

BBS

Pink

OBAMA dot GOV Barak Lessig call

Barak

Lessig call

Red Flag Linux

Open everything

What can we learn?

Closed Bounded Facebook Wikipedia Secondlife Makers Faire Chumby Sneaky DS Open W3C/IETF

Closed

Bounded

Facebook

Wikipedia

Secondlife

Makers Faire

Chumby

Sneaky DS

Open

W3C/IETF

Open source is changing the way we… Coordinate Community Change

Coordinate

Community

Change

Dimensions of open source Methods versus Values Virtual distributed communities

Methods versus Values

Influence O  ΔC O  C OΔ  C

O  ΔC

O  C

OΔ  C

Panel overview Introduction Johan Gorecki ICT – enabled distributed collective intelligence Pierre Berthon Philip DesAutels The Multinational Corporation Brian Donnellan Robin Teigland Discussion with audience

Introduction

Johan Gorecki

ICT – enabled distributed collective intelligence

Pierre Berthon

Philip DesAutels

The Multinational Corporation

Brian Donnellan

Robin Teigland

Discussion with audience

Brian Donnellan Faculty member Business Information System National University of Ireland at Galway 20 years working in US multinational corporations Actively engaged in research on Information System Innovation

Faculty member

Business Information System

National University of Ireland at Galway

20 years working in US multinational

corporations

Actively engaged in research on

Information System Innovation

The evolution of the MNC (Perlmutter) Phase 1 : Ethno-centric - Complex in home country, simple in subsidiaries Phase 2 : Poly-centric - Varied and independent Phase 3 : Geo-centric - Increasingly complex and interdependent Phase 4: ????????

University Industry R&D Products $1B markets People Transfers Source: D. Clark et al.: Innovation in Information Technology National Research Council of the National Academies http://darwin.nap.edu/openbook.php?record_id=10795&page=R1 Entertainment Portable communication CTSS, Multics/BSD Unix SDS 940, 360/67, VMS Berkeley, CMU, CERN Novell, EMC, Sun, Oracle Sketchpad, Utah GM/IBM, Xerox, Microsoft E&S, SGI, ATI, Adobe Spacewar (MIT), Trek (Rochester) Atari, Nintendo, SGI, Pixar ARPANET, Aloha, Internet Pup DECnet, TCP/IP 1965 1970 1975 1980 1985 1990 1995 2005 Rings, Hubnet Ethernet, Datakit, Autonet LANs, switched Ethernet Lisp machine, Stanford Xerox Alto Xerox Star, Apollo, Sun Engelbart/Rochester Alto, Smalltalk Star, Mac, Microsoft Berkeley, Caltech, MOSIS Many Berkeley, Stanford IBM 801 Berkeley, Wisconsin Timesharing Client/server computing Graphics Internet LANs Workstations Graphical user interfaces VLSI design RISC processors Relational databases Parallel databases Data mining Parallel computing RAID/disk servers World Wide Web Speech recognition Broadband in last mile IBM Tokyo, Wisconsin, UCLA IBM, ICL ICL, Teradata, Tandem Wisconsin, Stanford IBM, Arbor IRI, Arbor, Plato IIIiac 4, CMU, Caltech, HPC IBM, Intel CM-5, Teradata, Cray T3D Berkeley Striping/Datamesh, Petal Many Berkeley, Purdue (CDMA) Linkabit, Hughes Qualcomm CERN, Illinois (Mosaic) Alta Vista Netscape, Yahoo, Google CMU, SRI, MIT Bell, IBM. Dragon Dragon, IBM Stanford, UCLA Bellcore (Telcordia) Amati, Alcatel, Broadcom PARC, DEC, IBM SUN, SGI, IBM, HP Oracle, IBM, Sybase

Perspective #1 - Fernando Flores Transactions between people in business boil down to requests and promises on the one hand, and offers and acceptances on the other What is missing is a clear understanding of the conditions of satisfaction

The Atom of Work - Flores

Perspective #2 - Michael Thompson There is no such thing as an organisation, there are only ways of organising and disorganising: the individualistic, the hierarchical, the egalitarian, the fatalistic and the autonomous - each of which is a way of disorganising or subverting the other four. Management must be concerned with “clumsiness”: with encouraging those subversions that are constructive for the pluralised totality and with discouraging those that are not.

Organising and disorganising (Thompson)

The environment is on everyone’s agenda

Climate Savers Computing Initiative The Initiative is comprised of consumers, businesses and organizations that have come together to drive energy efficiency by: Increasing energy efficiency of new PCs and servers Promoting use of power management Goal: reduce computer power consumption 50% by 2010! 1

The Initiative is comprised of consumers, businesses and organizations that have come together to drive energy efficiency by:

Increasing energy efficiency of new PCs and servers

Promoting use of power management

Robin Teigland Associate Professor Center for Strategy and Competitiveness Stockholm School of Economics Sweden PhD on knowledge flows through informal networks in MNCs and impact on competitive advantage Especially interested in virtual worlds

Multinational corporation as social community Specializes in creation and transfer of knowledge Superior to market as organizational vehicle to transfer knowledge across geographical borders The more tacit the knowledge, the more likely transferred within the firm Kogut & Zander 1993

Specializes in creation and transfer of knowledge

Superior to market as organizational vehicle to transfer knowledge across geographical borders

The more tacit the knowledge, the more likely transferred within the firm

Kogut & Zander 1993

Best practices and knowledge flow through networks and communities of practice http://www.slideshare.net/SOMESSO/speaker-1-bettina-kahlau-presentation

Organizing in MNCs Network picture from http://n-e-r-v-o-u-s.com/blog/?m=200712 Hierarchy Linear, static, process-based organization Heterarchy Dynamic, integrated collaboration networks

eZ Systems and the eZ ecosystem: #1 open source content management software eZ Partners Community Customers Enterprise open source – “Grow the cake” 60 Employees in 8 countries (Europe & Asia) 230+ Partners 5000+ Customers 30,000+ Community members www.ez.no Skien, Norway

Enterprise open source – “Grow the cake”

60 Employees in 8 countries (Europe & Asia)

230+ Partners

5000+ Customers

30,000+ Community members

History tends to repeat itself…. Steam engine Internal combustion engine Microelectronics Late 18 th C Late 19 th C Late 20 th C Schön 2008

A new workforce is appearing… Mahaley 2008, Merrill Lynch 1999, Beck and Wade, Prensky “ Digital Immigrants” “ Digital Natives” Company loyalty Work ≠ Personal Professional loyalty Work = Personal

Towards 3-D internet Level of Interaction Time Hamilton 2008 Individual Web 1.0 Thinking Mosaic, Prodigy, Compuserve, AOL, Netscape Connected Web 2.0 Thinking Facebook, Friendster, Yahoo, Blogger, Wikipedia, eBay, Typepad, LinkedIn. Amazon, MySpace, Textamerica, Delicious, HubPages SENSORY 3D Internet Thinking SecondLife, Active Worlds, There, SimsOnline, Club Penguin, World of Warcraft, 3D planets, ToonTown, Habbo, VSlide, Protosphere

Increasing effectiveness in traditional industries “ Soon all fashion designers will be originating their designs and managing the production in virtual worlds ….Why such a dramatic change? Economics, pure and simple .” Shenlei Winkler, Director Fashion Research Institute

3D internet Before the first plate of steel is even bent for production, the passengers will have flown, the crew will have serviced, and the pilots will have flown the plane. CEO of Boeing supplier

China is making big efforts in Virtual Worlds! A “virtual economy district – a world where millions will work, communicate, and be in love” Reaching out to the 150 mln overseas Chinese 7 million inworld at same time Five virtual banking licenses auctioned for $404,000 www.crd.gov.cn, www.foreignpolicy.com “ The real China is only a piece of land. We believe that there must be a China in the virtual world and the real world.” Robert Lai, Chief Scientist, CRD

A “virtual economy district – a world where millions will work, communicate, and be in love”

Reaching out to the 150 mln overseas Chinese

7 million inworld at same time

Five virtual banking licenses

auctioned for $404,000

Discussion – Some questions to ponder What defines the boundaries of the MNC? From nonporous to porous Ecosystems and “open source” What defines an employee of the MNC? From binary membership to fuzzy membership Microemployees and community members Where is the MNC located? From the physical to the blended (physical & virtual) Labor “mobility” Are we stuck in a traditional mindset? Knowledge creation and transfer in MNCs superior to the market…..but is it superior to networks?

What defines the boundaries of the MNC?

From nonporous to porous

Ecosystems and “open source”

What defines an employee of the MNC?

From binary membership to fuzzy membership

Microemployees and community members

Where is the MNC located?

From the physical to the blended (physical & virtual)

Labor “mobility”

Knowledge creation and transfer in MNCs superior to the market…..but is it superior to networks?

Thank you! Johan Gorecki, Globe Forum Business Network [email_address] Pierre Berthon, Bentley University [email_address] Philip DesAutels, Microsoft [email_address] Brian Donnellan, NUI-Galway [email_address] Robin Teigland, Stockholm School of Economics [email_address]

Johan Gorecki, Globe Forum Business Network

[email_address]

Pierre Berthon, Bentley University

[email_address]

Philip DesAutels, Microsoft

[email_address]

Brian Donnellan, NUI-Galway

[email_address]

Robin Teigland, Stockholm School of Economics

[email_address]