Leadership and Legitimacy through Consent and Coherence — with Aaron Dignan

BOUNDARYLESS CONVERSATIONS PODCAST — SEASON 2 EP #12

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BOUNDARYLESS CONVERSATIONS PODCAST — SEASON 2 EP #12

Leadership and Legitimacy through Consent and Coherence — with Aaron Dignan

Aaron Dignan shares a radically different approach to leadership as something that needs to be more coherent and inclusive. In his own company — The Ready — they are using the power of consent and purpose to create legitimacy around distributed leadership, allowing teams to work dynamically and in tune with internal and external market forces.

Podcast Notes

Aaron Dignan is the founder of The Ready, a global organizational transformation and coaching practice, where he helps both large and small companies adopt new forms of self-organization and dynamic teaming. Over the last ten years, Aaron has studied organizations and teams with a new way of working that prioritizes adaptivity and autonomy over efficiency and control.

Aaron is the co-host of the Brave New Work podcast, an active angel investor and helps build partnerships between the startups and end-ups he advises. He’s also a co-founder of Responsive.org, and has sat on advisory boards for GE, American Express, PepsiCo, and Cooper Hewitt. He is the author of Game Frame and Brave New Work.

In this conversation, Simone Cicero and co-host Emanuele Quintarelli are not afraid to go deep, looking into a boundaryless future. Tune in as we explore how The Ready funds new ideas in the business, the role of “micro-socialist” experiments in an organization, and how to balance your personal development and uniqueness alongside the development of an organization.

To find out more about Aaron’s work:

Other references and mentions:

Find out more about the show and the research at Boundaryless at https://boundaryless.io/resources/podcast/

Thanks for the ad-hoc music to Liosound / Walter Mobilio. Find his portfolio here: www.platformdesigntoolkit.com/music

Recorded on 27 January 2021.

Key Insights

1. To reach coherence in a self-organizing context requires more directional leadership in the early stages of the organization, than later on. Aaron likens it to setting up a community garden, growing its muscles over time until the community knows how to take care of itself and its “shared thing”. The first period is likely to require more deliberate efforts in leadership to shape coherence and enthusiasm, but not necessarily by the same people. People can be leaders in fields that they master more, whether geographically or in terms of expertise.

2. In The Ready, finding the right entrepreneurial fit both with the external and internal market is important. While they don’t typically “name” people entrepreneurs, some people will be more inclined to build products, while others may be more into content creation. The roles and teams are shaped and re-shaped based on reputation and are highly dynamic. Aaron also explains how every four months The Ready are “making eight to 15 entrepreneurs”, by distributing seed funding to ideas proposed directly by team members.

  • Listen to how The Ready deals with the question of entrepreneurship around min 19:13.

3. Working with consent is a way to create legitimacy for distributed leadership since — as Aaron explains — “if it’s instantiated through consent, and it’s controlled through the power of consent, and can be edited through the power of consent, then it has a different texture, it has a different patina to it than it would if it was just from me”.

Boundaryless Conversations Podcast is about exploring the future of organizing at scale by leveraging on technology, network effects, and shaping narratives. We explore how platforms can help us play with a world in turmoil, change, and transformation: a world that is at the same time more interconnected and interdependent than ever but also more conflictual and rivalrous.

This podcast is also available on Apple PodcastsSpotifyGoogle PodcastsSoundcloudStitcherCastBoxRadioPublic, and other major podcasting platforms.

Transcript

This episode is hosted by Boundaryless Conversation Podcast host Simone Cicero with co-host Emanuele Quintarelli.

The following is a semi-automatically generated transcript that has not been thoroughly revised by the podcast host or by the guest. Please check with us before using any quotations from this transcript. Thank you.

Simone Cicero:
Hello, everyone. Today we are back with the Boundaryless Conversations Podcast and with a slightly unusual co-host. Today with me, there is not Stina, our usual co-host, but Emanuele Quintarelli from Boundaryless, our micro-enterprise leader for the EEEO initiative. So, Emanuele.

Emanuele Quintarelli:
Hello, welcome everybody. Happy to be here.

Simone Cicero:
And we have a wonderful guest today, Aaron Dignan. I hope I pronounced it well, Aaron, right?

Aaron Dignan:
You got it. You nailed it. Yeah, happy to be here.

Simone Cicero:
Aaron is the co-founder of The Ready and also author of the wonderful book, Brave New Work, and many, many more things that maybe we’re gonna touch upon during the conversation. So, this conversation starts from a Twitter exchange we had. We have known each other since a few years, actually. And a few weeks ago, I was talking about my experience with leadership and coherence in organizations. And it seems like a very hot topic today, as we are living through the unbundling of the firm. Now, everybody’s talking about this. And, yeah, I mean, I think it was nice to see that you agreed first on this idea of coherence being, to some extent, the expression of leadership. And then you wanted to put some — clarify some points around, for example, the idea that you would rather replace the idea of leadership with the idea of governance and stewardship. And you also hinted towards leadership being more like a distributed process than concentrated in one person. And I was slightly disagreeing. So, let’s maybe start from there. And maybe you want to articulate a little bit better why you weren’t so comfortable with my first tweet?

Aaron Dignan:
Well, I think right out of the gate, the word leadership to most people in most industries in most cultures, is kind of connected to this idea of a single person or a person who holds power and doesn’t relinquish it. Or even a positional power that doesn’t relinquish it and that exists in the structure hierarchically on a semi-permanent basis. So, the idea is that the corporation has a CEO, the corporation will always have a CEO, and the CEO will always have the ultimate power. And that is the part that I bristle at a little bit simply because so many of the systems that you and I study, derive a lot of their greatness and their genius from the things that happen between and among people. Not just the people that started it, not just the people that are in positional power, if there even is positional power, in a lot of those organizations.

And so I really like the thesis of the idea that coherence is the surest sign that things are going well, that there’s a presence of identity and momentum and direction and togetherness in the system. I think that the alternative to that is chaos, right? The alternative to good coherence is we don’t know what we’re doing or why we’re doing it, we’re moving in multiple different directions. And coherence is the murmuration, or the flock of birds is moving as one. And so I really — that resonated with me a lot. But as in the case with a flock of birds, that you might see a bird at the front, but that bird doesn’t have positional authority, they happen to be there. They happen to be in the front, they will move and rotate and adjust with others when the time comes. And so that was the part I was just trying to, I don’t know, nudge a little bit for the lazy reader.

Simone Cicero:
Right. Well, that’s a very interesting way to start because a few things that I was noting down in the background. Now, first of all, maybe of course, when you talk about birds, and this murmuration, I tend to think that this works because we had millions of years of evolution in the background.

Aaron Dignan:
Yes.

Simone Cicero:
So, it kind of feels natural, while my experience of an organization especially and that’s another point that maybe you want to touch on; the difference between the established organizations versus emergent organizations, that lots of times today, it’s also a discussion between — a distinction between 20th-century organization and 21st-century organizations. So, these are maybe two points that need to be taken into account when we discuss about an emergent process of leadership. Because my experience, I don’t know you, but again, I’ve been working with two or three emergent organizations and my experience is that leadership is hard. So, you basically need to really express intentionally this leadership inside the organization.

Aaron Dignan:
Yeah, I don’t disagree with that. I mean, I think I have two thoughts about that. One is, the earlier the days are for the organization, the more important I think that is. Because you haven’t yet created the space, you haven’t yet defined whatever boundaries, there might be in this boundaryless future. You haven’t created the structure, the infrastructure that allows for self-governance or self-organization or even emergence within the organization to unfold. So, I kind of — I always liken it to creating a community garden, right, which is owned by the community and operated by the community. Well, when it’s been there for 20 years, the muscles are strong, the bones are strong. There’s a sense that the community knows how to take care of this shared thing.

But the day that someone has the idea to start it, they do have to lead. They do have to put the stakes in the ground and dig up the dirt and establish those first boundary rules and conditions about what it means to participate and who can participate, and how they can participate. So, I don’t disagree with you at all that there’s a real role and a need for that. And early days in a human organization might be the first 10 or 20 years, potentially, right? I’m not talking about months one and two here. But by the same token, I think that the kinds of things that we need leadership on or that we need, ideas, directionality, enthusiasm, coherence gathering around are varied, and not every single one needs to be done by the same people. And so for example, just because I’m the founder of The Ready, does not mean that I should be the one necessarily to lead the organization to a place of more diversity, equity, and inclusion. I can play a role.

I can be an instigator, I can be a spark, I can support. But, maybe I don’t have the expertise, maybe I don’t know what I need to know, in order to move us in that direction. And maybe someone else who has the right lived experience needs to actually help us to construct that reality. So, and the same is true for marketing and brand and sales and where we should go next and expansion and European business. I mean, I don’t understand the business culture in the Netherlands as well as my partner Jurriaan. So, I can’t lead in that context. And so for me there, it’s not leadership, they’re leadership’s happening throughout the system. And the older it gets, and the more established that original source is and distributed that is, the more that can be a moving, dancing thing, I believe.

Emanuele Quintarelli:
Aaron, so I have a follow-up question. I agree with you and I agree that leadership is becoming distributed, it’s happening already, between the people and not even in the people or in one individual, specific individual at the top of the organization. In that case, how does coherence look like? How can you maintain coherence, basically, without structure? What else can we use for it?

Aaron Dignan:
Yeah, I mean, I’ve always thought of coherence as being a two-part story. One is about storytelling. What is the tribal knowledge, the storytelling, the origination, the myths and beliefs of the organization. And I think in some ways, that’s the — if there is a role for a founder/leader that lasts, it’s often that. It’s often to be a storyteller, and telling stories about what the future might look like, that gather people around the fire. So, I think that continues and we get more storytellers and more chapters. But that’s one piece of the coherence is that we all have, in our minds, this narrative about what we’re doing, why we’re doing it, where we’re going, how it’s going. And then the second piece of it, I believe, is actually the feedback loop with reality. So, coherence can come from feedback, from what you’re doing, and what you’re trying and what’s working, and what isn’t. And often, what I see is I see firms cohere around what works. So, they begin to see like hey — and what works could be defined by money. It could be defined by market sentiment, it could be defined by their own experience, right? When we all work this way, it feels better then we can cohere around that. So, yeah, I feel like it’s like feedback and storytelling are probably the two things that drive the most instead of maybe mandate and instruction.

Emanuele Quintarelli:
Would you add the purpose on the list?

Aaron Dignan:
Yeah, I think purpose is sort of intimately connected with storytelling, right? It’s connecting to deeper meaning-making and to intent, and to impact. And usually, we share that in the form of a story. We share that in the form of, here’s what’s going on in the world. And here’s the breakdown, or the problem, that is the plot point that starts the journey. And here’s the thing — here’s how we want the world to be different when we’re done. So, I think, yeah, we sort of interpret purpose through the hero’s journey, many times.

Simone Cicero:
So, that’s very interesting. I mean, I don’t wanna look like the bad guy here, but…

Aaron Dignan:
Oh, no, please feel free!

Simone Cicero:
… I had this very interesting conversation once, around this idea that it’s great if we can create an organization whenever everybody can be unique. The question is, you can also be unique outside the organization as well. So, the point is, what it takes from you to be part of an organization, especially an organization that is on the market. What I mean with that, a few years ago, I had the chance to listen to a lecture magistralis from Zadie Smith, she was giving this excellent speech in Rome, at the festival for the literature, and she was talking about creativity. And she was talking about this idea that you need to compromise with the market at some point because there is nothing creative if there is no market there. Or at least you cannot be on the market faking the fact that you are not there. No, you are there. You are on the market. You need to be compromising. So, I think what we are doing — how we are doing this in Boundaryless, for example, now, from the organizational architecture perspective, that I think is a space that we would like to discuss in this conversation. So, we are — to some extent — making the case for the organization to grow through micro-enterprises.

Now, in this, we are mutating, and we have found a whole lot of meaning in this entrepreneur structure that Haier is promoting, and we are helping them to open source and to make available to everybody and in the process embedding in our way of organizing. And I think the interesting thing is when you make it clear that you can get autonomy, but this has a cost to find the market fit, basically, I think this is really a different way, and it’s a powerful way to overcome this, I would say continuous friction in organization between those who do and those who expect, I would say, to have a role. That’s pretty much the point. The question is, you need to venture out, you need to find the fit with the market. And in this process, you need to compromise. So, why don’t you create a venture out around you, around your team, and become part of something that maybe has a shared purpose? But then it’s up to you to find your product, your fit to the market. That’s why I said also, coherence needs to deal with product design, product development. What do you think about that?

Aaron Dignan:
I think we are in agreement on that, actually. Even within The Ready, we’re pretty big believers in both of those ideas. And I think the thing that we also value a lot is the internal marketplace. So, the finding fit with the external market entrepreneurially is important. But we also have a lot of internal marketplace activity that goes on because we work in teams. And because those teams are not fixed, people get to decide who they work with. And when people get to decide who they work with, you get a lot of movement and a lot of shuffling, and a lot of sampling. And over time, what happens is that some people’s reputation grows and their demand grows, and some people’s reputation shrinks, and their demand shrinks. And there are ways to work with that and provide help and feedback and advice and overcome some of that. But at the end of the day, that’s a good market force, helping folks understand if The Ready is right for them, if they’re right for The Ready, if the market that they’ve chosen to work in is a good fit for their skills and interests, etc.

So, there’s all this internal marketplace going on. And then there’s also an external marketplace that we mostly express right now through regions. But that, I also can see some lines of business evolving around. So, we have a European cohort that works mostly independently on projects that are there and their own currency and with very little assistance from individuals on the stateside. They’re able to leverage the brand and the materials and all of that infrastructure. But they kind of make it work on their own. And then in the US, a different unit with its own kind of market and pricing and focus. So, yeah, I think you’re right. I think that is necessary and in some ways, it eliminates the need for a bunch of other policy and direction that you have to have if you don’t allow market forces internal or external to nudge and shape and force that compromise.

Emanuele Quintarelli:
Aaron, I need to react to this and to ask this. I thoroughly understand, thoroughly get the set’s say intention of letting people bloom, invent at the force of the market and understand where the market is going, trying to find a fit and trying to build something. But I also see, let’s say the risk of adding two levels of citizens into your organization. So, I would say the entrepreneur and everybody else. And maybe by doing that we are also impacting psychological safety, impacting the conditions for everybody else to contribute, not just by creating a product or by creating a new micro-enterprise, but also bringing the ingenuity, the energy, the fashion, the competences that they have; how to balance this; how out to keep the rest of the team within the organization with the same level of engagement and passion, creativity that we need, for me, at least, to scale your organization? Not as a single individual but as really a community, as you said at the beginning.

Aaron Dignan:
I think it’s a great question. And I would say we’re still learning about this. I don’t mark this as an area where we have all the answers. I don’t mark any area as an area where we have all the answers. But my experience of this is that we don’t explicitly name people entrepreneurs, for starters. But we do have personality types and skills that emerge in the system. And some people take more risk and some people go further afield, and some people want to sell more and do more and grow more, and others prefer to execute and prefer to advise and prefer to create content and so many other things. But because we view market making as a team sport, that can’t really be done without all those different types, at least not at scale. It doesn’t, at least for now surface as a massive tension in the organization.

There are definitely different levels of participation and different levels of intensity. And what tends to happen is that the people that like to make markets and like to try new stuff, kind of hang out together more and cook up new stuff more. And the people that like to do training, do training, and the people that like to make content, make content together. And by the way, a lot of those maps are not separate, right, some people are in more than one kind of informal cohort within The Ready. And I think if you asked everybody to draw it, it would be quite a soupy diagram. But, yeah, I think we’re just sort of listening to our own motivation and our own energies, and making sure that everybody’s free to pursue their energy to the greatest extent they can.

And one of the ways we do that is that every four months, so we run on a trimester or a tri-cycle schedule. So, every four months, we break for a week, and we go dark, and we focus on our own operating system and our own way of working and our own connections and emotions. And one of the things we do during that week is we cook up ideas for new initiatives, and then we fund those initiatives together. And so that’s become a really neat vehicle for entrepreneurship. And not just entrepreneurship, that’s about market making, like, “Hey, we’re going to do an online course, and we’re going to sell it to these people, but also entrepreneurship around, we don’t have a training program, we should make one. And we’re going to invent one from the ground up.

And so because those things get funded, and because the people that propose those initiatives, or those projects, get complete control over those funds. We’re making eight to 15 entrepreneurs every four months. So, they essentially walk away with, I don’t know, five, 15, $30,000, to do something, and the total authority to do it, with the support of the team and the consent of the team. So, it’s actually, I think it’s quite an interesting approach. And it allows us to have a diversity of different creations going on, not just creations that are about revenue, but also creations that are just about expressing again, what the purpose and what the culture and company can be.

Emanuele Quintarelli:
And I heard you say a magic word, at least for me, consent. And I know that you have been playing with sociocracy for a bit. What are the values, the beliefs, the assumptions, also hidden assumptions that you are getting from sociocracy? And how are they playing out into your way of working, into your culture as a firm?

Aaron Dignan:
Yeah, I mean, we’ve played with a lot of sociocracy, holacracy, different forms of decision-making from history. And I think what we’ve learned is that the consent principle that’s at the heart of most of that is super important because it becomes a framework on which to build that, where the foundation is strong. So, even if we decide to install a leader, or we decide to install a process or a constraint of some kind that feels more traditional, if it’s instantiated through consent, and it’s controlled through the power of consent, and can be edited through the power of consent, then it has a different texture, it has a different patina to it than it would if it was just from me.

And so I think that has been the big learning is that there’s a legitimacy to things that we have all granted our kind of sacred support to. And we have not reached a scale yet at The Ready where we do a lot of elected or representational consent. And so I think that’s the next chapter for us is to see how does that change the nature of how it feels? How does that change the legitimacy or the meaning of it? But obviously, you’re not going to do a full process around consent with 500 people every time you make a decision about what kind of napkins should be in the food hall. So, I think we’re going to have to test and learn our way into that. But we’re working on some behind-the-scenes projects that might help us with that scale question as well. So, I’m excited about that.

Simone Cicero:
Well, that sounds really interesting because when I think about — last week I was listening to your latest, I think latest podcast episode, maybe not the latest when this show will be aired, but as for now, 27th of January, you’ve been talking about capitalism on the podcast. I think from the early steps of our conversations we have been talking about market fit and gaining your independence, your autonomy through product design and product innovation, and market-making, which is — well, it’s capitalism 100%. It’s essentially the essence of capitalism. And at the same time, I think Emanuele and you brought up, for example, this idea of the shared investments. And also the idea that, to some extent, I think it’s also echoed in, for example, other artifacts that we have seen in, I don’t know, I can mention, for example, Enspiral where they’ve been testing out this idea of the livelihood pods. So, when people actually intentionally decide to put the skin in the game, but together livelihood pods work like, you know, people share their income irrespectively of who generates it.

So, these are small socialism, I would say small universe of socialism inside the organization, which is, I think, an interesting experiment to do. And also, it to some extent, it explains that you want to take on the structural workings and maybe try to inject in the organization some systemic interdependence between parties, between people, so that they are on their own, but there is also to some extent, interdependence between them. So, for example, in Boundaryless, we are now playing with having a profit redistribution that is partially on your own, on your own micro-enterprise, but partially also depending on the whole system performance and also — So, this is a way to say we are all in this also together. You’re not just on your own because otherwise, the question is what is the organization then if everybody’s on their own crating products? We are sharing the brand, whatever are we sharing then? So, I think this is an interesting polarity to explore in the next few minutes about this double dynamic, this idea of you need to find a way to develop yourself, but at the same time, we want to be developmental as an organization. We want to make this space where, if you are up to the challenge, you can try to emancipate.

But at the end of the day, you all fall back into this idea that if you want to make an impact of your organization, if you want to make an impact on you, you need to emancipate yourself, you need to create, you need to market make. And so I think we are not finding an escape from that, you know. And so my point is and it’s also interesting when you talk about the next step in the organization as it grows and moves into delegation. So, I see a lot of patterns that we are living through society in democracy and so on. So, the question is, really, is there a, I would say a model of organizing that maybe can help us to scale, this kind of approach and patterns from inside one organization into more systemic and scalable interaction? So, can we, for example, imagine that the way we manage certain organizations can be transformed into a shared protocol, let’s say that enables more cross organizational interactions across principles that I would say are more, I don’t know how to say it, but more general for the society, not just for our organization?

Aaron Dignan:
I love that a lot. Yeah, I think, first of all, I think we’re way too, at least here in the US, we’re way too monotheistic about system design. And so it’s like, some people are like, I’m a capitalist, and some people are like, I’m a socialist, and we have to fight about it. And I always think of it more like wine and cheese. Like we the best meals are about combinations of flavors that you haven’t tried before, that really opened up a whole new palette. And so for me, I think about it as well, yeah, sure. Evolutionary market forces are incredible because what they do is they drive learning and improvement over time. That’s literally what has created all of us and the world we live in. And the buildings will get taller and the healthcare will get better. And everything improves on the back of this free-market competition. So, I don’t want to lose that. I would never want to lose that. That’s the engine of learning that we need. However, all by itself, it has a lot of extreme edge cases that I don’t really love. And so I actually see the role of the collective forces, collective consent and governance, as limiting the edges.

Let’s raise the floor so that the worst thing that happens to someone in our system is not the worst thing that can happen. Let’s lower the ceiling a little bit so that the best possible thing that could happen, can happen. And let’s use the benefits of both of those limitations and constraints to create an even more satisfactory middle, and then create some coherence around that middle. And so that’s — I sort of see them in balance, rather than in an argument or in conflict with each other. But I know that that’s not the normal opinion. And as for the shared org thing, I mean, I absolutely am excited about that. I think that some of the things that are happening technologically that would allow that to happen in terms of connections, and partnership and collaboration and agreement making are going to enable that, but I actually think the prerequisite is just that there are more organizations like ours, and like the ones that we enjoy following and learning from. There’s just not enough — there aren’t enough people yet, at the party, to really see the kind of game be level cohorting that I think is possible.

Emanuele Quintarelli:
Oh. Why is this not happening more? Is it due to leadership or some kind of leadership just to close the loop?

Aaron Dignan:
I think there are a variety of reasons why it’s not happening more. I think it is happening more and more, right? So, I think that what we’re allowed to say and talk about and do and consider and try now versus 50 years ago, is greatly improved. But it’s still very, very small. I think it’s mostly because the way that we drive culture right now and the way that we raise people and teach people to think, in school and at work and in media, still clings to a lot of stories that are not aligned with the story you and I are telling. And it’s pretty hard to compete with 12 years of schooling and 200 movies when you start to talk to someone about what’s possible. Not to mention the fact that if you don’t have a lot of the infrastructure you need around investment and funding and banking, and budgeting and all those sorts of things that would be done differently. If there’s not as much infrastructure for that, then it’s just going to always nudge people in the direction of the status quo. So, I do see it as a longer-term transition. But, I think that the world is certainly eager to teach us this lesson faster and faster. And so this year with the entire planet going to remote work, with everyone dealing with the chaos and the complexity of a pandemic, with the Black Lives Matter movement rising in strength and in awareness, there’s certainly a lot of signs that we’re ready to go deeper.

Emanuele Quintarelli:
I’m just wondering about a topic that I guess we haven’t discussed enough in organizations even the last few years, and that is ownership. Is there any real engagement? Is there any real distributed leadership, is there any real attachment to the outcomes and to the direction of the organization, if people have no ownership? So, ownership, also in a formal sense, having the skin in the game, having part of the organization? And some countries, we know this is dramatically complex, dramatically bureaucratic. And employees are not trained, have the background, the mindset to act as owners. Are we addressing this? Is this happening enough? I know about streward ownership, there are new forms of translating these into the bylaws into the incorporation of the firm, to protect the purpose on one side, but also to really open up the game to a broader part or to the entire organization. Is it part of the future for you?

Aaron Dignan:
Yeah, I think it’s an important part. And I think like so many things, it needs to be pulled apart into its pieces. So, ownership as a concept is a big bucket. But I feel like it’s about four things, mostly. One is about risk. So, do you have skin in the game and how does that feel? The second part would be about kind of emotional identity and connection. So, what is mine? What represents me? How do I sort of think about the entity versus my own identity in the world? The third is power control in the form of voting rights, the ability to shape what happens. And then the last would be upside and exit. So, how do I share in the gains of the creation and what does that look like? And I believe that you can check a lot of those boxes without necessarily sharing ownership. I think if you, particularly, if you have a firm that you never intend to sell, the exit value is zero. So, if it’s sort of a thing that’s built to continue, or if it’s a nonprofit, for example, that’s built to not have exit value and upside, I think you can get away with a lot of other moves, right? Because people can have skin in the game in a different way, people can have a vote and a consent, right, in a different way.

So, I think you can simulate the benefits of ownership. But I agree with you that you can’t get the full measure of that kind of connection and commitment without doing it, which is why we do it. So, at The Ready, we distribute equity at the end of every year. And the goal is basically to over time, dilute me into the system. And then over time after that dilute the system into the active players versus the inactive players. So, that shareholders that are not active in the business, are not receiving those annual grants, and they’re getting diluted as a result. And the shareholders that are active in the business are continuing to receive those grants, which means they’re either growing or maintaining their share of the enterprise. And so that’s our little miniature thesis about how to do it. But I think there’s a lot of cool thinking going on in the cooperative space, in the employee-owned kind of organizational space. And I’ve actually met quite a few companies lately where a group of people gets together right out of the gate, and they start with that pattern.

But to your point, I mean, it’s funny when we talk about it this way, to your point in the beginning of this podcast about leadership, I actually have seen that be challenging. I’ve seen it be challenging for startups who start with five or 10 equal partners to have a sense of where that groundwork leadership lives. Who is setting the stakes, who is defining the boundaries of the garden? And if that work is not clearly defined and consented to early, it can get really messy really fast. And so actually, I think that it demands kind of a focus on a different piece of the puzzle, which is that leadership creation source energy. When you have 10 people with an equal stake trying to start something, how to deal with that is actually quite challenging, I think quite interesting. So, yeah, I think it’s important. I think that there are lots of ways to address it, but by and large, I’m unimpressed with the way it’s handled in most organizations today. It’s still coming from a place of greed and scarcity instead of a place of abundance. So, I think we have more work to do there.

Simone Cicero:
So, let me try to patch together these as equations because I was having really deep reflections in the background. And the question, I think that we are not addressing is that all our conversations are still pretty much rooted in an idea of a society that is highly specialized and essentially works through markets. So, if it works through markets, there is no other human development thesis than the entrepreneurial thesis. So, sometimes I fall back to when the Wendell Berry’s work, and I think the listeners of this podcast maybe would be annoyed about this quote that I’m using all the time. But he speaks about the fact that you cannot delegate change, just through organizations. It also needs to be a personal matter. The way we impact the world, the way we show up in the world is a personal question. It’s not just a matter of how we design our organizations. We cannot delegate that to as a design problem, it’s not an organizational problem.

So, what I’m trying to say with that: so for example, you also mentioned education. And then of course, the education system that we have now is essentially an education system that is in service of the economic system. So, we have this education system because we have this economic system. And the education system is producing players that can play inside the economic system we have.

Aaron Dignan:
Or at least it used to.

Simone Cicero:
Yeah, I mean, of course, because if I think about my kids, for example, my kids don’t go to public school, I send them to kind of a collective school where it’s parent-run, and it’s very much about developing the whole of the kids. And I’ve been confronted with this lately, it’s a fairly personal matter here, but my oldest kid, may be, I don’t know how to say it in English — “plus endowed” -or something like that. So, he may have more like a rational intelligence and this will make it a perfect player for the current world. But I think going in a school like that will be complemented and exposed to different types of intelligence. And so I was thinking that maybe to really develop new ways of organizing for the 21st century, one thing that came out fairly strongly from our research on the new foundations of platform-ecosystems thinking the white paper is that we may need to look, to pay more attention to economies of essentials.

And for example, there is this awesome project in London called Participatory City that maybe you have been in touch with. And they are really focused on these economies of essentials. And I think that there is this amazing idea that you can achieve a new human development thesis that is significant, even if you work on the economy of essentials. So, you don’t need to work on this abstract specialized digital economy that we are talking about. And I’m starting to think that this is not just a possibility, it’s a must. If we really want to draw a new human development thesis, we need to look into that. Because that’s the way where we can depart from a super specialized society when the only human development thesis possible is that of entrepreneurship. And I’m not — I mean, I started this conversation as a proponent of that.

But I think we also need to acknowledge that maybe we as designers, practitioners, we need to start be more interested and actually less maybe interested in consulting, and maybe more interested in actually building those kinds of organizations where we can be investors, we can be co-owners, we can take over — I mean, not just maybe our food or our energy, but also our education, education of our kids, our welfare, much more as a, I would say T-shaped people. But also having stakes in something that goes beyond the digitized, specialized economy of the 20th century. I don’t know what you think about that, if you have experience also in working in such context, what are your thoughts?

Aaron Dignan:
So many! I mean, you could do a whole episode on that, right? That’s a rich vision of the future. I think the first thing I would say is, I agree that individual change and reinvention is at the core of what’s needed. But I think where I diverge is and I actually reconnect with you is that it’s through our social systems that we create our own identity, and we modulate it. And so whether that be the school system, or the work system or the family system, like we’re way more influenced by the things around us than the things within us than we think. And so I actually believe that it is still systems change that needs to happen. The question is, from who, and where, and how, and in what order? So, I think I do return to your point about essentials there and say, yeah, I mean, I think social systems change and essentials is instrumental in bringing about this, this different future. And ideally, it’s a different future where the richness and the diversity of opportunity, ways of being is wider and broader without the worst consequences, right?

And so in many cases, when people ask me, well, what, you know, we talk about the future of work a lot. And by that we mean self-organization, and boundaryless organizations and all that sort of stuff. But a lot of times when people come at me with a future of work question, they mean, AI and robotics. They mean what happens when there’s no employees in the Amazon factory? And what I always come back to, which I think connects to your theme here is, there’s going to be a future where there’s really high leverage businesses. Where there are businesses that 10, or 100, or 1000 people work at, but that affect billions of people, whether that be through machine intelligence, or whether that be through robotics, or whether that be through just internet scale. There’s going to be a lot of high leverage stuff going on. And that means that there’s going to be a lot of wealth concentration in the hands of those leaders, founders, shareholders, organizations. Which then opens up the door to conversations about things like universal basic income, which I know is a highly contentious concept, and one with a lot of interesting edges and possibilities.

But one of the things I think it affords is it affords the possibility for these different ways of being that you’re talking about to actually come into existence where entrepreneurial specialization is not the only way to live a good life, if there’s a social safety net, like that, that’s supported by this very asymmetrical, very nonlinear kind of success that’s possible for the few in the future. So, I actually — I look at the future and I see this really weird, elaborate dance between the hyper entrepreneurs, the hyper capitalists that create immense concentration of wealth, and the social systems around them that redistribute some of that wealth, not all of it, but some of it in favor of a society where there are a lot of different ways to be and different ways to win. And I think that some of that means going back to the land and back to a simpler existence, some of that means going more creative and artistic, some of that means going into business spaces that we previously couldn’t see before in an entrepreneurial way. But if you study complexity long enough, you come to appreciate diversity, right? The need to have lots of different mutations in a system to make it strong. And I think we’re way too homogenous right now.

Simone Cicero:
Well, I mean, this runs well with the concept of resilience, not because I think we have been living through this pandemic, and there’s been a lot of talking about how do we build a system — rebuild a system that is more resilient, less brittle? And I think we have, we have been talking about the economies of essential. And one thing that also brought this to my mind is, for example, some experiences that we are seeing now, in organizations similar to ours, to, I would say, to look at, for example, at salaries in a way that depends on your needs more than — your social needs more than your capability to produce value, for example, I can quote — I can talk about the experience that Dark Matter Labs is bringing forward in the UK, where they have this kind of system of salaries as I understand from what we had seen in public, that try small to solve the problems of the people to enable, them to really think to about creation and entrepreneurship in a more — in a freer way, I would say.

But also another point, it may be that again, maybe we want to think about organizations as being re-entangled with their communities and their landscapes. You know, for example, I was talking to someone from Google, which — and I think Emanuele was with me without mentioning who — but he was talking to me and telling me these kind of executives from Silicon Valley, they’re freaking out now because their homes are burning. You know, their homes are burning because of climate change, because of all the challenges we are living. So, really, maybe really, again, maybe this is a call for us to look into a new thesis of organizing that re-entangles that with the community and the landscape. So, I think maybe we as well, we need to focus more on ourselves, and also in our work as consultants with organizations to draw a new health thesis for organizations that reconnects them with their context. So, very fascinating conversation. Emanuele, maybe you wanted to add something, right?

Emanuele Quintarelli:
Yeah. I agree with you guys. But my question being a bit on the side of the corporation is to what extent are these concepts, principles, ideas, practices, shared by a typical CEO of a big organization? And as I feel, this is not there yet; what can we do to amplify this impact and bring it beyond the 100 well-known names of mature progressive organizations that are giving us hope, but truly are not enough to bring the world in a new trajectory?

Aaron Dignan:
Yeah, this is where I think The Ready has a different take than some other people in our space, which is better is better. And so when I work with organizations like Citibank, or the Federal Reserve, or Boeing, obviously, I’m not — the team is not going in there to completely reinvent capitalism, right? These are public institutions, publicly traded companies with fiduciary responsibility to their shareholders and all that sort of thing. So, there’s a different ambition there than when we work with a growing organization in the mid-market or the small market that is willing to do the truly radical thing. But our view is that a 5% more equitable, 5% more transparent, 5% more consent-driven organization is net net a better world, right? And actually, that the people that we touch and shape, one team, one function at a time, will move and spread, the ideas that they pick up into different contexts, and often, into contexts where they can do them more fully. And so I don’t think that we have to give up on the values of our principles here, or the ideals of our principles here, in order to engage with the real world, quote-unquote. I think we just have to go in with the attitude of moving in the direction of our principles is good.

And for those that are ready to move further and faster, fantastic. And for those that are not, how far are you willing to move? And that’s why we always start with the question of what’s adjacent possible for you. You know, if you’re a CEO with a traditional mindset, what is the move you can make? Because what I found is that in the last five years, more than the previous five, I’ll get on the phone with the CEO of a major corporation, expecting that I need to have my armor on and that I need to be ready to argue and make a case and explain and challenge them and they’re already there. As a person, as a human being there already there. There’s a spirituality and an awareness, and a desire for more meaning at work that permeates even the people that I talked to at the highest levels, not all of them. Of course, there are still dyed in the wool asshole capitalists out there. But a lot of people you would not expect to have a secret whisper in their heart about I wish we could do things differently.

And all we have to do is then just say, “Well, how do we feed that in a way that’s still safe for you?” How do we feed that in a way that still allows you to keep your job and just move in the direction? Because some people I know believe that we have to burn it down in order to reveal the new and we can only build it from the ashes. But I’ve always been a believer that we can kind of do both at the same time that there are people ready to burn it down. And I love those people. And I’m one of them. And there are people that are ready to move us forward. And I think that’s a critical component as well. So, yeah, that’s my belief about this is every little bit helps. And for those that are willing to be brave, that’s all the better.

Simone Cicero:
Yeah, I mean, and also to respond — to comment on your points, both your points. I think one thing that we seem to under — always under or another, I think it’s that we should not just talk to corporations. We also need to talk to the new constituents. Because the point is that the probably if markets are going to change, in part now are going to change it because of the risk landscape is changed. So, the World Economic Forum just released their risk report, and it’s a dramatic picture. And so you know, last week — I think two days ago, I was with Emanuele talking with a large corporation. And they said the pandemic pushed us to work on our purpose, you know. So, I think the risk landscape change are going to change corporations, for sure. But on the other hand, I think we need to also consider that maybe there are new constituents that may be more interested in, even in working with this new economies of essentials that we’ve be talking about, like cooperatives that you mention, or ways to self-organize markets in a way that are detached from the transaction or commodity-based market that we live.

So, for example, organizing farmers directly with customers that want to invest in creating new economic activities around farming, I think these are probably the spaces where we need to also practitioners of platform thinking or organizational development thinkers. So, this is probably a point that we need to also keep in mind. But as we move into the last bits of this conversation, because it’s already — it flew really — it’s almost 50 minutes we are talking, I wanted to ask you one key — a couple of key points that you really believe need to be on the table of those like us doing design, organizational development, and business model innovation. What are one or two most important things that you think we need to keep in mind?

Aaron Dignan:
I mean, in this moment, I’m thinking of two things. I’m not sure if these are the most important. But I’m on the top of my mind would be number one, if you’re among us, if you’re a listener to this show, if you’re in a system where you have the community and the consent to do interesting things, I think it’s really important that we try quite radical things. I think it’s important that we almost break it in order to understand and learn what’s possible, because other people won’t. And so if you’re thinking about changing your compensation system, or your performance review system, or your structure, or your — whatever it is, your roles. I like the idea of playing dangerously with going right to the edge of consent because we learn more. And it’s okay to do two or three different attempts. In a system where the community is saying, “Yeah, let’s go. Like, let’s make a mess to learn, and to create stories and to create motivation for others. So, a little bit of my battle cry is to be more brave and to be more radical, even if it’s wrong, as long as you have the support of the system, and frankly, the privilege to make mistakes. Not all of us do, but some of us have businesses that are doing well enough or communities that are well to do enough that we can take some risks. And I think it’s beholden on us to do that, to try the things that have never been tried before, or never been tried before in the way that we want to try them. So, that’s one thought.

And then the second thought is connected to that is just, we need to share more. I mean, I really do feel that sharing what we’re doing, how we work, how we operate, what we’re learning and the underbelly of that, the hard parts, what isn’t working, where we’re vulnerable, where we’re insecure, where we’re anxious, as a community is, is pretty critical. I know, externally to the market, and to the sort of sales channel of the world, we’re often accused of painting this very rosy picture and this very dreamlike picture of the future. And I think, at least within our own community, we need to do a better job of sharing exactly what we’re doing and exactly what it feels like and exactly what we’re unsure about. So, I would love to come back and do a second episode maybe with Rodney, where we share how we’re working inside our systems in great detail with great vulnerability. Because if we all did more of that, we could move and learn faster.

Simone Cicero:
Well, definitely. I mean, will be great, will be really great. And at the end of the day, I think we started from fiction, and then we ended up on a very much more shared note. And so at the end of the day, likely we agree that we need to, as you said, we need to be a little more brave in exploring the possibilities that we have with organizing. So, it was a wonderful conversation. One point before we close, where can our listeners engage the most with your work, and what are your suggestions?

Aaron Dignan:
Sure. So, on the web, we are TheReady.com and BraveNewWork.com. On Twitter, we’re @TheReady and @AaronDignan. And those are the places that we spend the most time so I would say yeah, find us there. That’s where we started this conversation. And I hope we see a few more pop up as a result of this.

Simone Cicero:
Definitely. And, of course, our listeners should also find a moment to catch up with your book that now it’s four years old, something like that?

Aaron Dignan:
Yeah, the book is two years and change, two and a half years old, and the podcast by the same name, Brave New Work is also out and that comes out every week. So, that has a little bit more freshness to it.

Simone Cicero:
Right. My idea of time sometimes stretches a little bit. So, thanks so much. It was an amazing conversation and really looking forward to another one. And Emanuele, do want to add something else?

Emanuele Quintarelli:
No, I’m very happy to having had this conversation. So, I look forward to stay in touch and to sharing more and these topics. Thank you so much.

Aaron Dignan:
Yeah, it was my pleasure.

Simone Cicero:
Thank you again. And our listeners, we’ll catch up soon