Can Natural Entropy Tackle The Tangle of Overheads?
Creating Value Through Enterprise
There are only two value creation functions in any commercial enterprise. The first function is making stuff or services - new ways of looking and doing is making services. The second function is selling stuff and services. Everything else is overhead.
Before the internet the overhead - see above - played the necessary roles of coordination, accounting and managing a top down organization. The internet has matured to the point that those functions can be radically decreased. The lower and lower costs of entry for newcomers in almost every area has turned competition into hyper competition. An app or a new way to use common technology puts every middle manager in danger of being redundant.
The Current Challenge of Automation
The uber trend is clear. The functions of middle management and white collar workers are being automated. The wave of creative destruction which is already eliminating manufacturing jobs is now ready to do the same with every administrative job.
The intermediary step - see above - is the Agile enterprise. Work groups that work in coordination. Free to take advantage of new opportunities while keeping administrative overhead to a minimum.
The 21st century enterprise - again see above - goes beyond the agile organization. Making, selling, and business functions are organized in self sufficient groups. The gig economy & freelancers are the fastest growing formations around the world. The lowest overhead and smallest “group” is the individual. Consultants, graphic designers, writers, artists, creatives in any speciality.
The challenge is finding people who can thrive in this new reality. The opportunity is that millennials are ready, willing and able. Those enterprises that are optimized for millennials will thrive. Those that don’t will stagnate and some will wither away. For millennials the challenge is to internalize the discipline and protocols required to self organize and the lessons of leadership. As with business enterprise, so with government enterprise, non profit enterprise, universities and personal well being.
A Historical Perspective on Complexity Waves & Entropy
As with any enterprise so with developed societies as a whole.
From Wikipedia: According to Tainter's Collapse of Complex Societies, societies become more complex as they try to solve problems.
Social complexity can be recognized by numerous differentiated and specialised social and economic roles and many mechanisms through which they are coordinated, and by reliance on symbolic and abstract communication, and the existence of a class of information producers and analysts who are not involved in primary resource production. Such complexity requires a substantial "energy" subsidy (meaning the consumption of resources, or other forms of wealth).
When a society confronts a "problem," such as a shortage of energy, or difficulty in gaining access to it, it tends to create new layers of bureaucracy, infrastructure, or social class to address the challenge.
Tainter, who first (ch. 1) identifies seventeen examples of rapid collapse of societies, applies his model to three case studies: The Western Roman Empire, the Maya civilization, and the Chaco culture.
Tainter begins by categorizing and examining the often inconsistent explanations that have been offered for collapse in the literature. [Note 4]
In Tainter's view, while invasions, crop failures, disease or environmental degradation may be the apparent causes of societal collapse, the ultimate cause is an economic one, inherent in the structure of society rather than in external shocks which may batter them. He cites diminishing returns on investments in social complexity. [Note 5]
Wikipedia - https://en.wikipedia.org/wiki/Joseph_Tainter At the most general level, we are looking at a basic law of nature, The 2nd Law of Thermodynamics embodied in social formations. “The second law of thermodynamics says that energy of all kinds in our material world disperses or spreads out if it is not hindered from doing so. “
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“Not hindered from doing so” is often overlooked. Life sometimes depends on hindering the spontaneous pressures of energy to disperse. Once dispersed energy is concentrated, the natural pressure to entropy creates a flow of movement and energy all by itself. Overhead impedes that flow without creating new value. Meetings are ubiquitous examples of needless overhead.
". . . meetings as thieves: of joy, of productivity, of mental freedom. Citing a distinction first made by Paul Graham, the prominent venture capitalist, Costache told the room that some people thrive on meetings. These he called Managers, people who require a weekly calendar splotched to saturation with hourly changes of venue and cohort. But there are Makers, too — poetic souls whose well-being can be shattered by an ill-timed ‘‘sync,’’ ‘‘brand lab’’ or ‘‘share-out’’ in a conference room. Makers can’t live like Managers. They require ‘‘Maker hours’’ — long, unspoiled afternoons to muse, contemplate the verities, build digital things and play stress-relieving games of Carcassonne. They need rich, solitary, germinative time." Meet Is Murder They’re boring. They’re useless. Everyone hates them. http://nyti.ms/2oy9DLb
No longer needed overhead is an energy sink. Time wasted in useless meetings, rules that don’t make sense, too busy being busy instead of doing the work that creates value. Overhead makes it harder to respond to new situations quickly and appropriately.
Entropy Can Lead to Devolution
Today we see the pressures of entropy in the devolution of power from overhead laden government organizations in the developed world. The pressures have been building for years. Stagnant wages, lost manufacturing jobs, a cultural dislocation for some parts of the population. The Trump and Brexit phenomena are the release of that energy in the political sphere. Often when energy is embodied in politics it wraps itself in authoritarian xenophobia. The most likely scenario is that kind of mental framework as magical thinking confronts reality. The Scottish and Catalan devolution movements do not need the authoritarian triggers. But the process is the same. Energy has been concentrated in both areas. Both have everything they need to be viable independent states. They have the opportunity of releasing pent up energies without going through the ugly part.