Author: esko-kilpi

Work of Art

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Esko Kilpi photo

Ancient societies took it for granted that skills would be handed down from generation to generation. Developing one’s talent as an artist or a craftsman depended on understanding and following the principles of earlier masters. Art and craftsmanship may suggest a way of life that waned with the birth of industrial society, but this is misleading. The future of work may resemble the history of work, and this is because of our newest, most advanced technologies.

The corporate system is transforming into a maze of fragmented tasks and short-term gigs. Although the modern era is often described as a skills economy, most companies have a short-term focus, which means for a worker that when her experience accumulates, it often loses institutional value.

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The Future of Management

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Esko Kilpi photo. Constantin Brancusi at the Art Institute of Chicago

Management thinking is moving towards an understanding of human action as a process of sense making. What an organization becomes emerges from the sense-making relationships of its members, rather than being determined by the choices of a few powerful individuals.

Management has historically been seen as a collection of tasks involving planning, organizing, controlling and incentivizing. A competent manager is believed to be able to analyze organizational and task requirements and also the emotionally loaded human motivations. Successful management has then been able to remove conflict and uncertainty and accurately predict and plan the future.

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Business Game Design

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Esko Kilpi photo. Magasin III gallery in Stockholm

Smart contracts substitute boundaries. The kernel of a firm is a live social graph of networked interdependence and accountability.

In organization theory, firms are commonly understood as entities adapting to the changing environment. The post-industrial approach is different. It associates change with becoming.

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Post-blockchain Smart Contracts Creating a New Firm

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The new cryptocurrencies and post-blockchain smart contracts make it possible to leave behind the simplistic finance model of the industrial corporation.

What is still the mainstream model of the firm was born when the typical company owned and operated a manufacturing plant. Entrepreneurial investors put up the capital which was used to build the factory. The initial investors, the shareholders, were the only parties with significant assets tied up and at risk in the enterprise. This is the historic reason why shareholders are the “residual claimants” to the firm’s income. Residual claimant means that the shareholders get their compensation last, if something is left after creditors and employees are paid. Claims by creditors are fixed and employees typically have negotiated compensation principles in advance of doing something. Payments to creditors and employees are thus seen as independent of the performance of the company.

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The Programmable Enterprise

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The atelier of Constantin Brancusi in Paris. Esko Kilpi photo

The firm of the future may be ten million people working together for ten minutes

Corporations are the dominant mechanism by which economic activity is organized. Whether there are opportunities for social innovation in the corporate world is hence a key question for the prosperity and well being in the emerging post-industrial society.

Over the past years, intelligent technologies, peer-to-peer cryptocurrencies and the Internet have laid the foundation for a very small size and a very low-cost enterprise with the potential for managing very large numbers of business relationships. The impact of these new actors is still hard to grasp because we are used to thinking about work from a different perspective.

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The Essential Skill of Pattern Recognition

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Painting by Heidi Lampenius. Esko Kilpi photo

“A lighted match does not cause a fire. Rather, a fire takes place because of a particular combination of elements of which the lighted match is just one.”

The way we want to make sense of the world around us often has to do with causality. The question we ask is what caused “something” to happen. There is a variable, the “it,” that happened, that is now to be explained. In scientific study this variable is regarded as dependent. An independent variable, or variables, that cause it are then sought. This is also the if-then model of management. In organizations, a familiar explanation for success is that a particular manager or a particular culture caused it. But scholars are increasingly pointing out the fact that this view of the relationship between cause and effect is much too simplistic and leads to a limited or even faulty understanding of what was really going on.

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The Future Skills We Need

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Esko Kilpi photo

Economic growth is about value added. In manufacturing it was adding value as a transformation process from raw materials to goods. Economic growth today is still about value added but the transformation process is often very different. The industrial process was a linear, sequential chain of predictable acts. The problem to be solved was known and the solution to the problem was clearly defined. In creative work, the transformation process is a non-linear, complex movement of thought from unclear problems to developing solutions. Work is exploration when defining problems as well as for creating solutions.

The worlds of mass manufacturing and contextual, problem-based work require very different thinking and skills. In the learning-intensive world we live in, it is not about reductionist job roles and narrow, clear responsibilities any more. Everybody needs to take part in the common movement of thought.

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