You can define an organization as a way of coordinating the efforts of a group of people to accomplish a certain aim. A project can be defined in the same way, except that a project is time-limited. Lundin and Söderholm (1994) developed the theory of the temporary organization to refer to projects.
An organization has traditionally separated the roles of the members of the company (employees) and the customers by dividing the stakeholders into the ones that are in the company and the ones that are out. An organization has traditionally clear boundaries.
A WSJ article about start-ups that monetize sharing the assets of the customers, shows the increasing trend to use the customer as producer of the service. This is not new, of course. Internet has been able to offer business opportunities to start-ups that exploit customers inputs and there is a huge trends on this sense : crowd-sourcing, open innovation, etc.
Internet has showed that organizations with a very limited structure (like the one behind Wikipedia) can have a huge impact by using crowd-sourcing. In fact, small teams have showed the most amazing creativity. Less is more. It is said that in the beginnings of Apple, Steve Jobs wanted Apple not to have more than 100 employees. He fired somebody in order to employ a new one. The MacIntosh division was composed of a hundred people according as explains Guy Kawasaki. Ferran Adrià, the world-famous haute-cuisine chef, works in teams of maximum thirty people. The impact of all this small teams can be huge in terms of creativity and innovation.
But of course, it is not about the number of people only but mainly about the choice of the right people. Diversity plays a role but talent is the key factor. But how to select the best people? Like finding pearls, you have to open many oysters until the happy moment finally arrives.
Imagine an organization where people can decide to enter the company and where the company do not select. Natural selection based on talent, motivation and implication.
Imagine an organization where there is no hierarchy. Each employee is a share-holder of the company based on their talent, motivation and implication.
Imagine an organization where all financial data are open, transparent, public and accessible ubiquitously and in real-time.
Imagine a real democratic organization, where the employees decide how to invest and what to develop.
For instance, imagine a film-production company that is a virtual company. Anyone is free to integrate a team in the virtual organisation. Through filters and an open voting system, ideas are classified and approved or rejected. Capital investment is done through existing crowd-funding system. The resulting film, just because it would have been developed by a collaborative way, would result a product that would be, in principle, attractive to the people. The process of film-making would be the best marketing tool.
For sure, such an organization would not be without risks and difficulties. Also a lack of clear leadership and command could result in endless developments.
But to think is (still) free.
Such organizations would be a mere way of coordinating efforts.
Ronald Coase (1937) developed the transaction cost theory (TCT) to explain why markets needed organizations. The reduction of friction and the reduction of inter-mediation that Internet has allowed might be at the base of a new interpretation of the reasons for the existence of companies and the underlying TCT.
Maybe we are starting to see new types of organizations that are just a formal and legal intermediary between individuals and an ecosystem.
In the Silicon-Valley, entrepreneurs, programmers and creative people jump from one start-up to another. What is important is to be part of the network, not in which node you are. Start-ups are just stones in the middle of the river’s flow, that allow frogs to be in the right environment without drowning. In Hollywood, films are organized as projects where artists and specialists are ‘free-agents’ (to use the term of Dan Pink) that work on a temporary base for a production. The production companies coordinate efforts of freelancers but do not employ them as in a traditional company.
These kind of highly-creative organizations could be then seen as spaces that can be physical or virtual where free-agents meet, share and interact by the development of projects.
The question is then, which kind of coordination a space needs and who and how this coordination can be more democratic, agile and effective.