The changing nature of knowledge
Q. HM: So, let's talk about business implications.
A. DW: One of the implications is that businesses will do better by consulting experts that put them into a network of people who disagree with one another, as opposed to the traditional model of hiring an expert who parachutes in, delivers an opinion in a hefty report and leaves. A lot of businesses are figuring this out, including some consulting firms, so that rather than you working with a single expert who is presumed to be highly informed and to be wise in your business, you are put into a network of experts who have different points of view, who may be non-traditional experts as well as more traditional ones, who are able to bounce an idea around, see how it works in different contexts, and approach the problem with a useful diversity. So that's one implication for business: the role of experts.
Another is making business decisions. When you make a decision, you just have to come right down to it, and say yes or no. So, this seems to be a case where you don't want the networked model in which knowledge is never settled and is always in disagreement. So my book suggests that traditional businesses have something to learn from the large online collaborative enterprises that adopt some form of networked decision-making. Ultimately you have to decide yes or no; but for some of these large collaborative projects, such as Wikipedia and Debian, the decisions are made as locally as possible. It's considered to be far better if the decisions can be made locally by the people who know the most about them. And so, as decisions escalate, these organizations rely upon networks, where the local people who are responsible for some smaller area of the project, engage in open discussions and debate, and it is the network ultimately that is making the decision. This, I believe, is really a useful way of thinking as corporations get larger and larger, because the person at the top in a traditional corporation cannot possibly be an expert in every area of that corporation. You know, the CEO of General Electric has to make decisions about everything from toasters to nuclear power plants to network news. Nobody can be an expert in all those areas. Traditional hierarchies work by reducing the amount of information that flows up, so that it can be managed. Where networks involve the local people at the edges of it, networks are able to embrace a much larger flow of information.
Q. HM: But somebody has to decide. Is it a democratic vote with a click box, or is it a filtering process where middle managers recommend the next level of middle management?
A. DW: Well, the first step I think is to recognize that although there are times when you will need a model in which the person at the top makes the decision, we have glorified leaders who do that. I think that it's now time to recognize that that process is the worst-case scenario.
Businesses can't be fully networked. They are required by law to be hierarchical, so there are limitations to how networked decision-making can be within an organization. But simply recognizing that decisions made hierarchically at the top are very likely to be worse decisions than ones that are made by networks is a really good first step.