The Economist magazine website has a nice little feature called “What’s in the Journals?” The page profiles a small number of recent articles from top-notch business journals with links to view the articles online (registration sometimes required). For those of us who are reluctant to shell out for pricey subscriptions to journals we don’t actually have time to read, this is a great service!
One of the articles reviewed in the latest column is called “The New Principles of a Swarm Business,” published in the Spring ’07 issue of MIT Sloan Management Review. The “collaborative innovation” principles described in the article may be particularly interesting for social entrepreneurs:
…members of a swarm typically reject the traditional business notion of building shareholder value as the basis for their decisions and actions. In its place, the swarm works toward the collective interest of stakeholders, which is broadly defined as any party that can affect or is affected by the innovation….shareholders but also employees, customers, suppliers, partners, and even competitors…
Thanks to the Web and other forms of online communications, swarms can form instantaneously and collaborate on innovative tasks from almost anywhere on the planet, crossing all geopolitical borders and cultural lines….these networks are self-organized by people who are intrinsically motivated to explore and develop ideas that they care deeply about.
…Some companies have used collaborative innovation networks to facilitate close cooperation between customers and product developers [example: BMW]…some companies have based their entire business models on collaborative networks of innovation [examples: Flickr, Amazon, Wikipedia].
The 3 Core Principles of swarm business are:
1. Gain Power by Giving It Away
2. Share With the Swarm
3. Concentrate On the Swarm, Not On Making Money
The socially-responsible Swiss cooperative Migros is mentioned as an inspirational example of an organization that has utilized these principles. I had not heard of Migros, but quickly learned that two million of Switzerland’s population of more than seven million are members of the Migros cooperative. Who knew? The organization’s 2006 Sustainability Report (2.1 mb PDF) is fascinating and inspiring – light years beyond any such report I have seen. Migros is clearly “committed to striking a balance between economic, ecological and social demands.” Their report candidly discusses Migros’ social/environmental performance – revealing that the organizations’ commitment yields some cost savings but also requires extra investment that depends upon customers’ willingness to “pay an appropriate price.”
Synchronistically, the July issue of National Geographic features an article called “Swarm Behavior,” the full text of which is available online. Apparantly, the study of swarm intelligence in animal groups (such as a colony of ants, flock of birds, or herd of elk) is providing insights that are being used by companies like Southwest Airlines to save costs and improve customer service.
MIT connections are mentioned there too. Turns out MIT recently opened a Center for Collective Intelligence focused on exploring the question, “How can people and computers be connected so that – collectively – they act more intelligently than any individuals, groups, or computers have ever done before?” Worth keeping an eye on…it seems to me that the most innovative developments in management and organization theory are either originated by or very ripe for application by social entrepreneurs.