IT Conversations | MeshForum - Verna Allee
Verna Allee Associates
Verna Allee"A value network is a way at looking at any purposeful organization, company, or network. It is any web of relationships that creates value through complex, dynamic exchanges of tangible and intangible value."
In this May 2006 session from the Mesh Forum in San Francisco, Verna Allee talks about the new idea of trying to identify, measure, and encourage, intangible business practices which don't show up on traditional balance-sheets and income-statements.
Traditional management tools increasingly do not present an accurate picture of how things really work in the new information age. For example, relationships between workers in different regions of the enterprise have become as important as those among workers who are close in proximity on a conventional org chart. Also, new information systems, and the resulting new practices, are creating a different understanding of the enterprise. These systems have genuine value, yet they do not show up as "assets" on traditional balance sheets.
Viewing all relationships as Value Networks provides a better way of understanding what is really generating a return. And it allows management, and individuals, to make the most of both the tangible and the intangible assets of the organization.
PlayEconomic theory freefall
Knowledge economy is abundant, it doesn't have diminishing returns
- share and walk away enriched
- have more of the resource via interactions
The idea of the firm is made up for legal and financial convenience
- to help us manage risk
- control intellectual property
- nothing says we have to structure work in the forum of hierarchies and bureaucracies
Transparency
- accessibility of information about your business
- disclose
- transparent society (ambient awareness) and cooperation
If we didn't have an idea of the firm, and just noticed how people interact with each other we would see networks (web of relationships and barter trading)
COMPLEXITY
Simple Order (Stable)
- procedure/process
- hierarchy to organise
Complicated
- eg a boeing 787
- take it apart, understand how it works as we have control of it
- we can predict
- hierarchy/network hybrid
Complex
- too many variables
- cannot predict or control
- living in a world of probability, not predictability
- conversation/network problem solving
Chaos
- localised weak networks
- hierarchies are gone
TEAMS
- a new form of work based on process reengineering
- value chain as a business model
- production line
- Beginning (input) Middle (Process) End (Value)
- teams were a nre structure and behaviour to previous model
- now networks/CoPs/roles (crews) are the new model
SNA/ONA
-knowledge flows along existing pathways
- find these, understand patterns, and create interventions to make them more successful
Patterns
- clusters
- boundary spanners
- brokers
etc..
INTANGIBLES
ROI - financial reports
We never see non-financial assets
- competence of people
- ability to get things done
- relationships (social capital)
- internal structures
- reputation (social capital-internal and external-knowledgeworker brands)
- environment
People are our greatest asset is a lie
- according to balance sheet people are an expense
- if you want to improve competency of people it's going to incur an expense
- hard to find money and support for this
What if we treated intangibles as assets
- how they grow and value
- this is important as financial assets only tell us about the past
- but your competency wil tell you about the future
Barter
You can't administer a network you can only serve it
- focus on roles (understand how each serves the network)
- manage the inputs and outputs of the roles instead of trying to control the system
