Rethinking Competition in a Local Living Networked Economy

As more communities move toward a vision of local living networked economies, the whole conversation about the nature and value of competition comes into question.

The invitation for local living networked economies emerges from commitment to the profoundly provocative and transformational question: What can we do together that we can't do alone?

Competition is one form of network connection on a continuum of possible connections. On the other side of the continuum is collaboration and in between are co-opetition, niching, and complementarity connections.

In competition, we�re committed to the eat-or-be-eaten demise of other market providers. In co-opetition, we team up with a competitor on a project or offering that serves us mutually, agreeing to compete on everything else. In niching, we serve or create a market segment that is under-served or under-satisfied. In complementarity, we provide other providers with value that helps them, succeed and grow. In collaboration, we�re committed to sharing market share with other providers and team up with them regularly for mutual growth of our respective businesses, the local market footprint, and growing non-local markets and business.

In a community where there is a thriving bicycle market, any combination of these five connections can occur among the bicycle shops in business there. The character of this dynamic market ecology of providers has endless possibilities.

Shop A is committed to a competitive connection with some or all of the other shops, doing everything it can to weaken or eliminate them from the market. Shop B is committed to growing new niches in the bicycle market, through the innovation of alternative energy powered products.

Shop C used to be a full-service shop but has recently strategically committed to being the prime supplier of tires for any of the other shops who agree to their sourcing. Shop D openly competes with shops A and E, and at the same time is committed to selective co-opetition with them in the shared reduction of health care costs with shared plans and joint marketing efforts to grow the local footprint of the adult market, since only 20% of this market ride bicycles on a regular basis.

Shops E and B have recently collaborated on a very successful regional bicycle marathon event partnering with local arts and culture organizations for the event. Shops B and C team up to share professional services, and use the cost savings to collaborate on price reductions and savings for their respective customers.

Each of these 5 fundamental market provider connections has potential value to create a provider network for the community that gives the community products and services that are increasingly: convenient, affordable, locally-relevant, market-diversity responsive, quality service, innovative, adaptable, proactive, and promotive of a local living economy.

The community has the opposite of these when the provider network ecology is dominated by competitive connections.

The competitive connection is the simple commitment to weaken or eliminate other providers in a community's market. If the provider network is weak, meaning it lacks a healthy mix of the other 4 kinds of market connections, dominance will occur and providers - and their local suppliers, employees, investors, and customers - will all lose as the cost of one dominant monopolistic supplier's gain. This can happen as well when two suppliers team up their resources and position to triangulate the rest of the market into failure.

The market loses everything in a monopoly of providers: choice, affordability, convenience, quality service, incentive for innovation, and the rest.

Creating thriving ecologies of market provider networks means engaging our assets with a commitment to foster, nurture, and reward a healthy mix of provider connections in any local community market. This is the job of network weavers, regardless of whether they act independently, as grass-roots organizers, as members of institutions, or as market provider members.

This approach is not only pragmatic, it is also possible, and begins with two simple steps: introducing the language of the competition-collaboration continuum and inviting people into new conversations that make them more possible.

Originally published at DesigningLife.com

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Swarms

From Wikipedia:

Swarm describes a behaviour of an aggregate of animals of similar size and body orientation, often moving en masse in the same direction. "Swarming" is a general term that can be applied to any animal that swarms. The term can be applied to insects, birds, fish, various microorganisms such as bacteria, and people. The term applies particularly to insects. "Flocking" is the term usually used for swarming behaviour in birds, while "shoaling" or "schooling" refers to swarming behaviour in fish.

Swarm is the social confluence of similarity. On a human level, it happens when we pay attention to the myths that connect us. That's why, as I suggest in The Stories That Connect Us, it matters what stories we share. Our choice of stories create either the fermentations of swarms or fragmentations of isolation.

Only certain kinds of stories have the power to provoke swarms. Think about what those could be, propagate them, and watch a swarm emerge!

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What kind of network?

Jack, Valdis and I had a wonderful lively discussion about networks and innovation diffusion a few weeks ago and I�d like to capture some of what we talked about here.

First, we continue to try to clarify the different kinds of networks. We three often use the term networks in the social network analysis sense of sets of relationships and the patterns they generate. However, most people use networks to describe intentional networks -- networks that have some awareness of the set of relationships and incorporate that awareness into their strategies. But there are considerable differences in the nature of that intentionality.

Jack came up with a nice way to represent some of those differences, see the chart above.

Some networks actually look like and function like organizations, or an organization of organizations. These tend to be intentionally focused on a particular goal or purpose, i.e. a housing network committed to increasing housing units available to low-income residents. Such networks are often structured like organizations in that they have membership and rules about how decisions are made. They tend to spend considerable time arriving at consensus and developing plans of action. These networks have had considerable success working on specific initiatives, such as advocating a specific piece of legislation but are often expensive to maintain over long periods of time.

This is in contrast to networks that are self-organized. In self-organized networks, the organizations or individuals may never all meet in one room and don�t decide on anything as a group. They move forward when individuals identify others with similar or overlapping interests and do something together. Generally, many small joint actions are generated and fewer large actions. The many groups involved in Regional Flavor initiatives are an example of self-organized networks. Meet-ups is another example.

Another quality of networks is their ideological stance. For some networks a specific ideology shapes the boundaries of the network, determining who is in and who is out. Such networks can generate tremendous energy (for example, the Right to Life network or some environmental networks). However, their homogeneity can sometimes limit their reach and innovativeness.

Networks that are driven by pragmatism and experimentation tend to shun specific ideologies. Individuals and organizations in such networks are looking for solutions to intractable problems that require massive innovation; or, they are trying to figure out new ways of organizing economic activity. Such networks tend to have many opportunities that encourage people to move out of silos and meet people different than them. They encourage lots of reflection about what has worked and what hasn�t. Scrum software development teams and hospital networks working to eliminate MRSA are an example of this type of network.

Where would your networks fit on this chart? Is this chart useful?

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Personalities in networks

I posted a tweet on this today and June suggested I elaborate, so here are some seminal ideas on 5 basic personalities that show up and engage in social networks.

Adders

People who are always introducing (adding) new people, new ideas, new questions, and new assets to the network

Subtractors

People who are always looking to take something (subtracting) from the network - they are the consumers, stealers, and energy-drainers in the network

Dividers

People who are always aligning people in opposition to others in the network; they keep the network divided into us-them divisions based on either-or thinking

Multipliers

People who create rhizomic possibilities that can keep multiplying, virally, by virtue of their replicability and value to the network

Integrators

People who create new fusions of possibilities, transcendent and transformational ways for the network to become more inventive and adaptive. These are the designers, architects, poets, and crafts people in the network who provide vision and inspiration to adders and multipliers.

Obviously, rich networks grow adders, multipliers, and integrators.

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