Here comes everybody (clay shirky) p29-31
WHY ORGANISATIONS?“running an organisation is difficult in and of itself, on matter what its goals. Every transaction it undertakes-every contract, every agreement, every meeting-requires it to expend some limited resource: time, attention, or money. Because of these transaction costs, some sources of value are too costly to take advantage of. As a result, no institution can put all its energies into pursuing its mission; it must expend considerable effort on maintaining discipline and structure, simply to keep itself viable. Self-preservation of the institution becomes the number one goal, while its stated goal is relegated number two or lower, no matter what the mission statement says. The problems inherent in managing these transaction costs are one of the basic constraints shaping institutions of all kinds”
“this ability of the traditional management structure to simplify coordination helps answer one of the most famous questions in all of economics: if markets are such a good idea, why do we have organisations at all? Why cant all exchanges of value happen in the market?”
-ronald coase 1937
- he went on to say workers could contract with one another, selling and buying labor
- it seems we have this now with agents and freelance contractors eg making a film
- coase says but it would underperform compared to an organisation because of the transaction costs, costs of discovering the options, and making and forcing agreements
- but even a firm begins to have trouble with transaction costs, and result in some activities worth not pursuing (managerial overhead can bogg down large groups)…sometimes markets may outperform firms depending on the cost of transacting the activity
“activities whose costs are higher than the potential value for both firms and markets simply dont happen”
“new social tools are altering this equation by lowering costs of coordinating group action”
- enterprise 2.0 tools enable methods of top-down stimulation to and see what clusters and emerges
