Social Media is subversive, but maybe not how you think

Back in 2005, Shirky argued that the Social Web offered an alternative to organizations. Working collaboratively has never been easier. And the innovation is ongoing: collaborative real-time editors (e.g., piratepad) are amazing. GitHub has taken collaborative software production to a whole new level by allowing anyone anywhere to fork any project in seconds. Doodle makes scheduling meetings painless. Silly things like raising funding can be done collaboratively: LunaTik raised a million dollars to design an iPod-watch using Kickstarter.

Each and everyone of these innovations directly compete against one of the services offered by typical organizations. It is not merely that the technology is replacing people (e.g., the office suite replacing secretaries). Instead, the very core function of organizations is challenged: organizing people toward common goals, animating the office life. But not all organizations are equally challenged. Facebook appears to be doing well. Meanwhile, the Egyptian government had a rough time recently.

How can you tell which organization is threatened? I believe that Paquet puts it well:

The internet is looking more and more like one huge machine for disintermediating the clueless.

Paquet was referring to the Gervais principle. In the Gervais model, organizations are made of three types of individuals:

  • Workers who exchange their labor against a monetary compensation. They include the creative types, the engineers, the writers, and so on.
  • Facilitators (sometimes called the clueless) who produce nothing tangible, but keep the organization running by staffing the hierarchy. Middle managers belong to this class.
  • Leaders who run the corporations. They are usually very well compensated. They are interfaces between reality and the life of the organization. They often take the difficult decisions.

One of the useful function of corporations is to create jobs, many jobs. In mature organizations, the clueless can easily form the majority of the employees. However, as the cost of organizing people falls, the need for employees to support the organization also falls. How many people in the average corporation are there to support random indirect functions which have been already automated by the Social Web? Consider Facebook. While Facebook is thought to be worth over $40 billion, it has only around 2000 employees. Normally, a company with nearly unlimited funding would be massively hiring right now: there should be countless middle managers, administrative assistants and the like.

Social Media won’t help overthrow tyrans or CEOs. But it may get rid of the evil middle managers and their assistants. When I read about what motivates the uprisings in the Arab countries like Egypt, it seems that the younger generation is upset with the bureaucracy which makes entrepreneurship difficult. You end up with a weak economy, where all the good jobs are in the ranks of the government or of some large corporations. Yet these young arabs are extremely well informed. They are clever and smart. And they know how to organize themselves very efficiently. They are tired of paying rent to the bureaucrats.

So, it could be that a new tyran will rule Egypt next year. But what I will be paying attention to, is the new Egyptian bureaucracy. The survival of the new government might depend on letting the younger generation organize itself, using social media, to create economic value. True democracy might not come. But I hope for a more agile and open government.

Further reading: Rushkoff has many relevant books, I recommend Program or be Programmed. I loved The Starfish and the Spider: The Unstoppable Power of Leaderless Organizations by Brafman and Beckstrom.

9 thoughts on “Social Media is subversive, but maybe not how you think”

  1. (…) even within an order of magnitude that’d be massive unemployment.

    Yes. And the crazy thing is that much of the capital seems attracted to Facebook… where it will probably not be translated into new jobs.

  2. An interesting caveat is that middle management was an important source of middle class jobs: you could work your way into a good salary somewhere in the depths of a corporation and put your children through college. Efficiency doesn’t “shrink” the pie, there’s still productivity to go around, but I wonder how easy it’ll be to find new jobs for the bureaucrats of the world.

    Facebook is valued at $40B, let’s say that’s inflated and go with $10B. Wikipedia tells me the market cap of all publicly traded companies is around $50T, to make up a number let’s say publicly traded market value only makes up 10% of total economic value, so $500T total. Dividing it out, it looks like if every company was as efficient as Facebook, we’d have enough jobs today for 100 million people. That’s not enough for America, never mind the world!

    You can certainly debate the appropriateness of Facebook as a stand-in, etc., but even within an order of magnitude that’d be massive unemployment.

  3. @Martin

    I am flattered that you translated my post.

    I also encourage you to adopt a Creative Commons license for the translated content. The idea is to explicitly allow others to reuse your content as well (the same way you reused my content).

  4. Hi Daniel!
    It’s a very good analysis the one you’ve done here!

    I’m here ‘cos a friend ask me to translate your text to Spanish.

    Hope it doesn’t bother you. It’s on my personal blog (http://tinchog.blogspot.com/2011/02/las-redes-sociales-son-subversivos-pero.html) and it has a permanent link to the original article.

    If you see that theres something wrong with it, please let me know. And even if you want me to take it off of the site, I’ll do it.

    Once again, hope it does’n bother you.

    My best regards,

    Martín.-

  5. I like your post. It is a coherent analysis like the rest of your blogs. I would like to translate it to french if you permit so.

    What do you think, Daniel?

    Thx

  6. @Moursil

    We are getting a bit off-topic, but yes, anyone can translate this blog. This is all very flattering, but I do encourage people who do so to use a Creative Commons license however.

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