June 30, 2006

Fusing Organizations and Market Knowledge

Filed under: Aggregation,Market — admin @ 5:31 pm

Information technology is undoubtedly changing the way the live, but the most radical shift will be in the way organizations connect with the market’s knowledge. We can already see this already occurring. The market supplies Amazon with preferences, and in turn Amazon processes it into relevant recommendations. The market supplies Google with hyperlinks, and in turn Google processes it into better search results. There are two recent incarnations that follow this same pattern. First, Crowdsourcing is where the market actually supplies an organization with goods (e.g. Photography) via the web and in turn the organization redistributes it to those who want it. Second, Freedbacking is where the market supplies an organization with constructive feedback, and in turn the organization can process and make better decisions about product updates.

The market as a vast resource of knowledge isn’t exactly new. In 1945, F.A. Hayek proposed that market price was an aggregation of the market’s knowledge on the scarcity of a resource. Within the last couple of decades there has been an explosion of research and commercial applications of this concept (usually called Information Markets). The most notable example is the Iowa Electronic Markets, a market for predicting economic and political events. A more interesting example is the experiment between HP and Charles Plott where an internal information market was able to forecast future sales better than top sales executives. And now, as mentioned beforehand, we are seeing even more interesting dynamics linking market knowledge and organizations.

June 22, 2006

Designing for the (dis)Organization

Filed under: Information Design — admin @ 6:16 pm

I am currently reading “Information Design” by Robert Jacobson. In the chapter “Chaos, Order, and Sense-Making: A Proposed Theory for Information Design” Brenda Dervin describes that

Information is a tool designed by human beings to make sense of a reality assumed to be chaotic and orderly

This was particularly interesting to me. Organizations function somewhere in between chaos and order, but (as I learned in my knowledge management course) organizations tend to create information that give the perception that everything is organized and working properly. While absolute organization may seem palatable, it doesn’t leave room for the new (i.e. innovation), and, of course, absolute chaos produces perpetual novelty without taking advantage of core capabilities.

So… here’s my question.

Do the increasing number of tools that automatically “organize” information really cause organizations to become myopic to the underlying (and increasing) disorganization? For instance, workflow diagrams tend not to really describe how work is actually performed.
Secondly, (as alluded to above) we shouldn’t caste disorganization as being something to avoid. How can we design information/tools that accurately reveal disorganization (i.e. chaos) that is in need of organizing? And how can we design information/tools to reveal disorganization that is actually healthy and produces alternative perceptions and innovation?