When we do business with each other we have to trust each other. In order to do that we want to reduce uncertainty. In order to do that we innovate institutions like contracts, banks, governments and companies. These institutions create high transaction costs. It is also possible to ‘program’ uncertainty reduction or trust in a protocol. That is what blockchain is about in our opinion. You can see the blockchain as an extra trust layer on the internet. The internet makes it possible to share information without almost any friction. With blockchain we can do business without having to trust each other. We can do transactions (profile, search, select, contract, purchase order, invoice, paying etc.) without almost any costs.
The early internet gave us a realistic vision of a decentralized democratic world, that enables information exchange without the interference of institutions. But now we all know that this didn’t happen. In contrary: corporations, financial markets and governments became more powerful than ever. Let’s not make this ‘mistake’ again with the blockchain.
We see blockchain organizing as a combination of new technologies and new organization models, that enables us to organize transactions between supply and demand almost without any transaction costs. And that is the basis for a successful organization form that will survive the next decades.
From the early days, when humans start to organize work, the main reason why we organize our work is to raise the standard of living. When we were hunters and gatherers, we discovered that the division of labor and coordination, led to better hunting. Even animals that where much larger or faster, could be caught; thanks to specialization (divide tasks), collaboration (communication&transactions) and focus (finalization). So it doesn’t matter what kind of work you have to organize, there is always specialization (supply), coordination and finalization (demand). And the form with the lowest coordination costs (the alternative with highest efficiency) will succeed.
So we believe that when you organize work, or more general supply and demand, there is always specialization, coordination and finalization. And in our digital society the best way (with lowest friction), to coordinate work or transactions is not longer ‘the firm’, ‘the hierarchy’ or ‘the manager’ but new forms like blockchain organizing.
One important concept in blockchain organizing is the concept of value. An example of a value is a course you can purchase. For example the course ‘Time-management’ from supplier ‘Schouten & Nelissen’. This is an example of how blockchain organizing works in the Dutch training & development market:
- The supplier enters product information in one place (profile)
- A NXP employee, for example can select a product (select)
- A product is delivered (action)
- A payment can be done with a blockchain protocol and the product is registered in the e-portfolio of the participant (transaction)
Number 1-3 are in production now, number 4 is in Proof of Concept development phase.
“You don’t have to choose between do it yourselves (firm) or contract out (market)
there are other, better forms.”